Vilas Transcore IPO

Incorporated in 2006, Vilas Transcore Limited specialises in manufacturing and supplying components for the power distribution and transmission sector. The company serves transformer and power equipment manufacturers in India and abroad. Key products include electrical lamination cold rolled grain oriented (CRGO) lamination core, CRGO slit coils, CRGO stacked cores, CRGO wound cores, and CRGO toroidal cores. These components are essential for power transformers, distribution transformers, and various types of current transformers.

Before the company’s incorporation, its promoter, Nilesh Jitubhai Patel, operated a proprietorship called M/s Vilas Transcore since 1996. The business was taken over by Vilas Transcore Limited in 2007, including all assets and liabilities. Under Patel’s leadership, the company has focused on quality, timely delivery, and customer customisation. From fiscal 2021 to 2023, revenues grew at a compound annual growth rate (CAGR) of 45.96%, driven by strong customer relationships and repeat orders.

Vilas Transcore Limited operates two manufacturing facilities in Por, near Vadodara, Gujarat, covering over 13,200 square metres. These facilities have advanced machinery and a combined manufacturing capacity of 12,000 MT. The company’s quality management system is ISO 9001:2015 certified, and it is approved for sourcing toroidal cores for Power Grid projects.

The company has established long-term relationships with major transformer manufacturers, both domestically and internationally. Major customers include Voltamp Transformers Limited, Electrotherm India Limited, Atlas Transformers India Limited, and Shilchar Technologies Limited. The company prides itself on maintaining high-quality standards and meeting customer specifications.

Vilas Transcore IPO Strengths

• Vilas Transcore Limited has a long-standing presence in manufacturing electrical laminations and other components used in various transformers. The company’s adherence to high-quality standards and precision has contributed to its robust revenue growth.
• The company operates from two manufacturing facilities located near Vadodara, spread over a combined area of 13,000 square metres, with an annual capacity of 12,000 metric tonnes. These facilities enable Vilas Transcore Limited to maintain cost-effective operations and provide timely supply to customers.
• Vilas Transcore Limited has built enduring relationships with both Indian and global transformer manufacturers. The company’s ability to deliver consistent, high-quality, and cost-competitive products has resulted in repeated orders and increased revenue from long-standing customers.
• By investing in process and product innovation, Vilas Transcore Limited can continue to meet diverse customer specifications and enhance its product portfolio. Strengthening in-house engineering capabilities will allow the company to offer more value-added and technologically advanced components.

Vilas Transcore IPO Risks

• Vilas Transcore Limited relies heavily on key customers, particularly Voltamp Transformers Limited, representing a substantial portion of its revenues in recent years. If Vilas Transcore Limited loses any of these key customers or if they significantly reduce their orders, it could negatively impact the company’s business and financial health.
• Vilas Transcore Limited typically does not enter into firm supply agreements, relying instead on purchase orders that can be amended or cancelled. This lack of customer commitment makes it difficult for the company to forecast revenue and production, potentially leading to financial instability.
• Vilas Transcore Limited plans to expand its operations in Gujarat but may encounter financial and operational challenges. Delays in securing necessary funds, regulatory approvals, or issues with the new premises could hinder the expansion, affecting the company’s growth and profitability.
• Customers pressure the company to reduce prices, which can affect profit margins. If Vilas Transcore Limited cannot offset these price reductions through cost-saving measures, its profitability and overall financial condition may suffer.