Quadrant FutureTek Set to Launch ₹275 Crore IPO After Receiving SEBI Nod

Quadrant FutureTek Limited, a Mohali-based technology firm, has received approval from the Securities and Exchange Board of India (SEBI) to proceed with its ₹275 crore initial public offering (IPO). This approval marks a significant milestone for the company, which is known for its pioneering work in rail safety technologies, defence cables, and other speciality systems.

Founded in 2015, Quadrant FutureTek has built a reputation as an innovator in the field of railway signalling and embedded system designs. The company’s research-driven approach has allowed it to develop cutting-edge safety solutions for rail passengers, ensuring dependability and efficiency in its systems. Over the years, the firm has expanded its services to include the manufacturing of speciality cables, particularly those used in defence applications and rolling stock equipment for the railway sector.

A notable feature of Quadrant FutureTek is its electron beam irradiation centre, which enhances its capability to produce high-quality cables. These cables are essential for various applications, including electric vehicles (EVs), solar power systems, and critical infrastructure projects. Quadrant FutureTek operates manufacturing facilities in Mohali and other key locations, including Bengaluru, Hyderabad, and Telangana, which house the company’s Railway Signalling & Embedded System Design Centre.

The company’s main clients include organizations from the defence and railway industries, which contribute significantly to its revenue streams. As of December 31, 2023, Quadrant FutureTek reported that 74.05% of its total revenue was derived from the railway sector, specifically from the sale of wires and cables. Meanwhile, 25.08% of its revenue came from the defence sector, highlighting its diversified portfolio and the importance of its specialty cables in national security operations.

With the SEBI approval secured, Quadrant FutureTek is preparing to launch its IPO, which will consist of new equity shares with a face value of ₹10 each. The funds raised through the IPO will be utilized for a range of purposes. Specifically, ₹175 crore will be allocated for the company’s long-term working capital requirements, while ₹25 crore will be invested in the development of the Electronic Interlocking System. This system is designed to enhance the safety and operational efficiency of railways by automating signal control, a critical component of modern railway infrastructure. Additionally, ₹25 crore will be used for the prepayment or partial repayment of the company’s existing borrowings, with the remaining funds being allocated for general corporate purposes.

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The IPO will be managed by Sundae Capital Advisors Private Limited, the lead book-running manager for the issue, while Link Intime India Private Limited has been appointed as the registrar. This collaboration ensures a smooth IPO process and enhances investor confidence in the offering.

Quadrant FutureTek’s financial performance has been strong in recent years, driven primarily by its expanding market presence and increased demand for its safety solutions and cables. In FY2023, the company’s revenue from operations surged by 46.56%, rising from ₹104.26 crore in the previous fiscal year to ₹152.80 crore. This impressive growth was largely attributable to higher sales of wires and cables to its railway and defence clients.

In terms of profitability, Quadrant FutureTek has also demonstrated solid growth. Its profit after taxes increased from ₹13.90 crore in FY2022 to ₹23.23 crore in FY2023, showcasing a significant improvement in its bottom line. The company’s ability to manage its costs and capitalize on market opportunities has positioned it well for future expansion, particularly as it continues to innovate in key industries like railways and defence.

Quadrant FutureTek’s IPO is expected to attract significant interest from institutional and retail investors alike. The company’s focus on critical infrastructure sectors, such as rail safety and defence, makes it an attractive investment opportunity, especially in light of the Indian government’s increasing focus on modernizing the country’s transportation and defence systems.

In addition to its core business in railway signalling and defence cables, Quadrant FutureTek is also positioned to capitalize on the growing demand for electric vehicle (EV) infrastructure. The company’s manufacturing facilities are capable of producing EV cables, a key component in the development of electric mobility solutions. This diversification into the EV space aligns with global trends toward sustainable transportation and energy solutions, further enhancing the company’s growth prospects.

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As Quadrant FutureTek prepares to launch its IPO, investors are keen to see how the company will utilize the funds to drive further innovation and expansion. The company’s strong financial performance, coupled with its focus on research and development, positions it as a leader in the safety technologies and specialty cables sector.

Overall, Quadrant FutureTek’s IPO offers investors an opportunity to participate in a company that is at the forefront of technological innovation in critical industries. With its strong client base, robust financials, and commitment to safety and dependability, Quadrant FutureTek is well-positioned for continued success in the years to come.