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Summary: India's expanding power infrastructure sector makes the Laser Power & Infra IPO difficult to ignore, but strong headline numbers tell only part of the story. Before subscribing, investors should look beyond the growth narrative to assess whether the business can convert opportunity into sustainable returns.
On paper, Laser Power & Infra looks like a business getting many things right. Profit nearly tripled in two years. Return ratios climbed sharply. The IPO (initial public offering) is also available at around 20 times earnings, a valuation that looks reasonable at first glance. The company has also signed a licensing deal to manufacture the next-generation power conductors in India.
Underneath that headline, the story begins to crack. The company burnt Rs 119 crore in operating cash in the same year it posted record profit. That is the tension this IPO does not resolve, and what you need to know before deciding whether to subscribe.
Cables, conductors and a bet on the grid
Laser Power & Infra manufactures the power cables and conductors that make up electrical grids. It also builds the infrastructure to distribute that power. The company runs three manufacturing units in West Bengal with a combined capacity of over 85,000 metric tonnes. Its products range from high-tension power cables to railway signalling cables. Clients include Indian Railways and state electricity boards, alongside private infrastructure players and international buyers across Africa and Asia.
Revenue comes from two segments. Manufacturing accounts for 73 per cent of the total, built on the sale of power cables, control cables and other conductors. The remaining 27 per cent comes from its construction arm, which delivers turnkey projects such as rural electrification, building substations and laying underground cables.
The in-house edge
Most cable manufacturers buy their raw material from outside. Laser makes its own. It produces base metal wires and insulation compounds in-house rather than sourcing from vendors. This does two things: it shields the company from sudden raw material price shocks, and it lets Laser bid cheaper on large government contracts, where thin margins usually decide who wins.
The company has earned approvals that are hard to replicate quickly. It is one of the accredited suppliers to Indian Railways for specialised signalling and power cables. This certification keeps most competitors out. Its execution record goes further: it has delivered electrification in flood-prone river islands reachable only by boat, dense forests and hilly terrain where standard construction logistics do not work.
Laser has also tied up with a US technology firm to manufacture AECC (Aluminum Encapsulated Carbon Core), a next-generation power conductor, in India. It replaces the heavy steel core in conventional cables with a lightweight carbon core wrapped in aluminium, carrying two to three times more electricity without sagging. It also works with standard installation tools, so utilities do not need to retrain their line crews.
A sector with more than one tailwind
India's push into solar and wind power needs entirely new transmission lines to carry electricity from remote generation sites to the main grid. Grid operators are increasingly replacing old cables on existing towers with higher-capacity ones rather than building new lines from scratch. That is Laser's immediate market.
The electrification of railway and metro signalling systems draws on the same approved product line. Government schemes to upgrade local electricity distribution networks add a steady pipeline of construction contracts, not a one-off boost. The company is also using its existing construction and project-management experience to bid for work in water pipelines and solar power plants.
The demand is not in question. What is in question is whether Laser Power & Infra can convert that demand into cash.
Laser Power & Infra IPO details
| Total IPO size (Rs cr) | 742 |
| Offer for sale (Rs cr) | 200 |
| Fresh issue (Rs cr) | 542 |
| Price band (Rs) | 203-214 |
| Subscription dates | July 9 - July 13, 2026 |
| Purpose of issue | Repayment or pre-payment of borrowings and general corporate purposes |
Post-IPO
| Market cap (Rs cr) | 3,004 |
| Net worth (Rs cr) | 1,267 |
| Promoter holding (%) | 75.3 |
| Price/earnings ratio (P/E) | 19.8 |
| Price/book ratio (P/B) | 4.1 |
Financial history
| Key financials | 2Y CAGR (%) | FY26 | FY25 | FY24 |
|---|---|---|---|---|
| Revenue (Rs cr) | 15.4 | 2,326 | 2,570 | 1,748 |
| EBIT (Rs cr) | 45.2 | 272 | 219 | 129 |
| PAT (Rs cr) | 72.5 | 119 | 104 | 40 |
| Net worth (Rs cr) | - | 725 | 575 | 473 |
| Total debt (Rs cr) | - | 871 | 504 | 403 |
| Cash flow from operations | - | -119 | 60 | 171 |
| EBIT stands for earnings before interest and tax PAT stands for profit after tax |
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Key ratios
| Key ratios | 3Y average (%) | FY26 | FY25 | FY24 |
|---|---|---|---|---|
| ROE (%) | 14.9 | 18.3 | 19.8 | 8.4 |
| ROCE (%) | 16.9 | 19.1 | 19.1 | 12.4 |
| EBIT margin (%) | - | 11.7 | 8.5 | 7.4 |
| Debt-to-equity (times) | - | 1.2 | 0.9 | 0.9 |
| ROE is return on equity, ROCE is return on capital employed |
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Beneath the headline numbers
Profit and cash are not the same thing. In FY26, Laser's highest-ever profit came alongside negative operating cash. Net cash from operating activities turned negative at Rs 119 crore, a sharp reversal from a positive Rs 60 crore in FY25.
The reason lies in unpaid bills. Trade receivables increased by Rs 357 crore in a single year, with the average collection period stretching to 196 days in FY26 from 135 days in FY25. Trade receivables as a per cent of revenue from operations rose sharply from 44 per cent in FY25 to 59 per cent in FY26, significantly higher than peers such as Apar Industries and Dynamic Cables, which reported receivables at around 23 to 24 per cent of revenue in FY26. As a result, the working capital cycle, which measures how long cash remains tied up before returning to the business, deteriorated from 88 days to 138 days. In other words, revenue and profits are being recognised well before the company receives the cash.
This is structural, not incidental. A large share of contracts are tied to state and central government bodies and electricity boards, known for long and unpredictable payment cycles. The client base adds to the risk. The top 10 customers made up 72 per cent of FY26 revenue, with one customer alone contributing nearly a quarter. On the construction side, close to 79 per cent of the order book sits with government clients.
To bridge the gap between earning and collecting, the company has leaned on borrowings. Total debt more than doubled in two years, from Rs 403 crore in FY24 to Rs 871 crore in FY26. Debt now stands at 1.2 times the company's net worth. Interest costs rose sharply in FY26, eating into the same profit growth the headline numbers otherwise celebrate.
Revenue shrank even as profit grew
Revenue fell in FY26 even as the broader sector grew. The company says geopolitical disruption drove up raw material costs, prompting some customers to defer orders. But peers did not see the same slowdown. Apar Industries reported 23 per cent revenue growth in FY26, and Dynamic Cables, a smaller, comparable player, reported 17 per cent growth.
Between FY24 and FY26, the company added about 38 per cent more manufacturing capacity. Utilisation over the same period fell from 86 per cent to 62 per cent. The new capacity has not generated new sales.
Where that capacity went is the sharper concern. Roughly 70 per cent of the new investment went into a unit at Kharagpur, which produces low-tension cables and conductors. The remaining 30 per cent went into the Dhulagarh units, which house the railway signalling lines and specialty products that the prospectus itself identifies as higher-margin. Most of the recent capital did not go there.
The valuation question
At 19.8 times FY26 earnings, the stock looks reasonable at first glance against the backdrop of an attractive, fast-growing sector. But context matters here. Its closest listed peers trade far higher: Apar Industries at 58 times earnings, and Dynamic Cables, the more comparable smaller player, at 21 times. Laser sits below both.
A lower multiple than every peer in your own sector is not a discount waiting to be noticed. It is usually the market pricing in a specific doubt, and here that doubt is legible in the cash flow statement. While Laser's ability to grow is not in doubt, the quality of that growth is. Every additional rupee of revenue this year required proportionately more working capital to sustain it, and that drag suppresses the return the company earns on each new rupee it invests.
The IPO does not fix this. Roughly Rs 490 crore of the fresh issue goes towards repaying debt, which will lower interest costs and tidy up the balance sheet. But that does not change the underlying constraint. Any genuine re-rating will depend on Laser proving three things across more than one year: revenue growing without a matching rise in receivables and debt, factory utilisation recovering, and the margin mix shifting towards higher-value products. Until all three move together, the stock is likely to keep trading on execution credibility rather than on the sector's broader promise.
Also read: Kusumgar IPO: Should you apply? Its growth story has a tear
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