Quadrant Future Tek IPO

Quadrant Future Tek IPO Details

Quadrant Future Tek IPO Date

Quadrant Future Tek IPO will open for subscription on January 7, 2025, and close on January 9, 2025. Investors will be updated about the allotment status on January 10, 2025. 

Investors who have been allotted the company’s shares can expect them to be credited into their demat accounts on January 13, 2025. The shares will be listed on the NSE and the BSE on January 14, 2025. 

Quadrant Future Tek IPO Price Band

The IPO is entirely a fresh issue of 1 crore shares worth ₹290 crore. The Quadrant Future Tek IPO price band has been set between ₹275 to ₹290 per share. Interested investors can choose a price within this band to apply for the IPO. 

The Quadrant Future Tek IPO listing price will be determined on January 14. The listing price is the price at which a company’s shares debut on the stock exchanges.

Quadrant Future Tek IPO Lot Size

Quadrant Future Tek IPO details have been declared. The minimum lot size for an application is 50 shares, and the investor would have to apply for a minimum of 1 lot. Meanwhile, the IPO issue size is approximately ₹290 crore.

Quadrant Future Tek IPO Objective

The proceeds from the fresh issue of shares will be used for the following objectives: 

Working capital: The company will use ₹149.7 crore from the net proceeds to fund the long-term working capital requirements. 

Capital expenditure: Nearly ₹24.37 crore from the proceeds will be used to develop the Electronic Interlocking System. 

Debt payment: The company will use ₹23.61 crore to prepay/repay all or part of the outstanding working capital loan taken by the company.

Corporate expenses: A part of the proceeds will be used for general corporate expenses of the company. 

About Quadrant Future Tek

Incorporated in 2015, Quadrant Future Tek is a research-driven company specialising in developing new-generation train control and signalling systems for Indian Railways. The company also manufactures speciality cables, which are used in railways rolling stock, the naval defence industry, solar power and electric vehicles (EVs). 

Quadrant Future Tek is known for providing indigenously developed solutions focusing on technology and innovation. The company manufactures Electron Beam Irradiated cables known for their superior mechanical and thermal properties. The company also focus on developing train safety products and solutions. 

The cables are ideal for rail vehicles, naval ships, and solar and wind installations, where safety, durability, and weight reduction are crucial. The company’s cables meet international safety standards and are certified by multiple authorities. As of March 31, 2024, the top ten clients of its cable business accounted for 86.20% of total revenue.  

Its manufacturing facilities are in Basma, Mohali, while its Railway Signalling & Embedded System Design centers are in Bengaluru, Karnataka, and Hyderabad, Telangana. As of September 30, 2024, the total installed capacity for the speciality cable division stood at 1,887.60 metric tonnes, while it has an installed capacity of 4,492 station Train Collision Avoidance System (TCAS).

Quadrant Future Tek has indigenously developed a Train Collision Avoidance System under KAVACH to enhance the safety of Indian Railways. After technical clearance from the Research Designs & Standards Organisation (RDSO) under the Ministry of Railways, the company has started deploying these systems in South Central Railway. In December 2024, the company secured a tender to on-board KAVACH equipment in 1,200 locomotives for an aggregate value of ₹978.6 crore. 

Between FY22 and FY24, the company's revenue from operations rose at a CAGR of 20.65%, while net profit rose 175.1% during the same period. Moreover, the company is growing its presence in the train collision avoidance system by developing new products. The primary focus of the system is to enhance the efficiency and safety of the railway network. As per the company, deploying KAVACH equipment costs approx. ₹7 million per kilometre, which offers a huge business opportunity for the company. 

Now, Quadrant Future Tek Limited is launching its initial public offer (IPO). The total IPO issue size is ₹290 crore, comprising entirely of a fresh issue. Its shares will be listed on the NSE and BSE. 

Company Name: Quadrant Future Tek Limited

Company Established on September 18, 2015

Company Type: Public Limited Company

Managing Director: Mohit Vohra

Financial snapshot

Quadrant Future Tek IPO Analysis

Strengths and Opportunities

1. The company focuses on innovation and technological development to build  Automatic Train Protection Systems. 
2. The four main building blocks of the train control systems are domain expertise in signalling and train controls, product engineering, safety-critical system engineering, and knowledge and application of global standards.
3. The company signed a Memorandum of Understanding with RailTel to work on KAVACH in Indian Railways and other Countries Railways. 
4. It has an in-house design and product development team that works on its Rail Signalling Products & Solutions.
5. The company uses unique technology to manufacture cables ideal for multiple industries, namely the Railways, naval defence, Renewable Energy, and electric Vehicle sectors.
6. It has advanced manufacturing facilities with a wide range of power and control cables focusing on innovation and cost efficiency. 
7. The solar power segment is growing consistently in India and around the world, creating a global market for irradiated cables in renewable energy and electric vehicles.
8. Quadrant Future Tek has an experienced team of promoters and senior management led by Mohit Vohra which allows for its efficient growth. 
9. Between FY22 and FY24, the company's revenue from operations rose at a CAGR of 20.65%, while net profit rose 175.1% during the same period. 
10. The EBITDA margin for the nine months ended December 31, 2023, and FY23, FY22, and FY21 was 29.04%, 17.37%, 9.12%, and 15.50%, respectively. 

Risks and Threats

1. The company’s dependency on a single manufacturing facility exposes it to risks of production delays or shutdowns.
2. Any policy change in the Indian Railways or Defence sector could adversely affect the company’s operations and growth prospects.
3. The company relies heavily on a small group of customers, which means that order cancellations or delays could harm its financial performance and business operations.
4. The absence of long-term contracts and dependence on tenders can lead to revenue unpredictability and business volatility, impacting the company’s growth and cash flows. 
5. Failure to meet strict quality standards could result in cancelled orders, damage to the company’s reputation, and loss of future business. 
6. Complex programming and software issues in the Train Control System division can delay crucial projects and lead to additional costs. 
7. The company has high working capital requirements, which can require external funding. Lack of access to funds could limit the company's growth potential and operations. 
8. The company has faced negative cash flows and may continue to experience declining earnings or losses. 
9. The company reported a net loss of 12.11 crore for the six months ended September 30, 2024. Weak financial performance can affect the company’s reputation and workflow. 

How to apply for the Quadrant Future Tek IPO?

If you are interested to invest in Quadrant Future Tek IPO, following are the steps to apply:

1. Login to your Upstox account, using your six-digit PIN
2. After successfully logging in, click on ‘Discover’
3. On the Discover tab, you will find the ‘Invest in IPO’ section
4. Under the Invest in IPO section, look for the ‘Quadrant Future Tek IPO’ tab and click on it
5. Now fill in all the required information, like ‘bid price’ and ‘lot size’
6. Confirm and click on ‘Apply’
7. Accept the mandate on your UPI app

You can also pre-apply for the Quadrant Future Tek IPO on Upstox which usually begins a day before the IPO opens for subscription.