Quadrant Future Tek, a company specializing in next-generation Train Control and Signalling Systems, has got approval from the Securities and Exchange Board of India (SEBI) to increase ₹275 crore through an Initial Public Offering (IPO).
The IPO, filed with SEBI on June 2, 2024, will apply a fresh issue of shares with a face value of ₹10 per equity share. Link Intime India has been selected as the registrar, and Sundae Capital Advisors will serve as the only book-running lead manager for the issue.
IPO Use and Business Overview
The profits from this IPO are planned to help Quadrant Future Tek’s development and functional requirements:
- ₹175 crore will be required towards financing long-term working capital requirements.
- ₹25 crore is given for capital expenditure on developing an Electronic Interlocking System, a necessary component for improving train security and efficiency.
- ₹25 crore will be used for prepayment or partial repayment of outstanding working capital term loans, which will help lower the company’s deficit load and maintain financial strength. The remaining funds will be used for public corporate goals.
Founded in 2015, Quadrant Future Tek, whose headquarters is in Mohali, Punjab, operates manufacturing skills in Basma, Mohali, along with Railway Signalling & embedded System Design Centers in Bengaluru, Karnataka, and Hyderabad, Telangana.
The company mainly operates the railway and defense sectors with technical cables and advanced safety systems.
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Financial Performance and Market Position
Quadrant Future Tek has revealed remarkable growth, with its revenue from functions increasing by 46.56% to ₹152.80 crore in FY 2023 from ₹104.26 crore in FY 2022. This increase was mainly due to higher sales of wires and cables to the railway and defense industries.
Profit after tax also grew greatly, bouncing from ₹1.94 crore in FY 2022 to ₹13.90 crore in FY 2023. For the 9 months terminating December 30, 2023, the company reported a revenue of ₹100.37 crore and a profit after tax of ₹14.42 crore, reflecting a strong financial position that underpins its growth strategies.
Investment Insights and Risks
Investors looking into Quadrant Future Tek’s IPO should consider its strategic emphasis on creative rail safety technologies and its solid financial growth trajectory.
However, as with any investment, possible investors must perform thorough research on the company’s market position, financial health, and risks linked with the railway and defence sectors.
Quadrant Future Tek’s promise to develop advanced technologies and its plans to use IPO returns for strategic growth industries highlight its prospect for future success.
The company’s IPO is predicted to attract considerable interest due to its innovative focus and important role in improving rail security and dependability.
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Disclaimer
The information provided in this article is for informational purposes only and does not constitute financial advice. Always consult with a certified financial advisor before making any investment decisions. The views expressed here are based on the information available at the time of writing and are subject to change without notice.
