Geojit, IPO report on Exicom Tele-Systems Ltd
Exicom Tele-Systems Ltd. (ETSL), incorporated in 1994, is a power management solutions provider which specialises in DC power systems, Li-ion-based energy storage solutions, and electric vehicle (EV) charging. It has a market share of 16% in DC power systems and 10% in Li-ion battery applications for the telecom sector market, and a market share of 60% and 25% in the residential and public charging segments, respectively. They operate three manufacturing facilities in India, comprising Solan Facility situated at Solan, Himachal Pradesh, and Gurugram Facility I and Gurugram Facility II situated at Gurugram, Haryana. India's telecommunications power systems market is projected to grow from ₹15 billion in FY23 to ₹24 billion in FY28 at an 8.5% CAGR. Energy storage solutions are also expected to grow from ₹19.5 billion in FY23 to ₹36.1 billion in FY28. CRISIL Market Intelligence & Analytics predicts EV charging market value to grow to ~₹13-14 billion in FY24 due to doubled EV sales and a 50% increase in public charging stations.
Valuation and Outlook
At the upper price band of Rs.142, ETSL is available at a P/E of 31x (FY24E Annualised), which appears to be fully priced. Considering the EV sector's robust outlook, Company’s first mover advantage in both power management solutions and EV charging infrastructure, improving financial and operational track record and future expansion plans, we assign a “Subscribe” rating on a medium to long term basis.
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