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Quadrant Future Tek operates in the Indian specialty cables and train control and signaling systems sectors.Specialty cables are utilized in railways, naval defense, solar power, and electric vehicles. Quadrant Future Tek Limited IPO is a fresh issue of equity shares with a face value of ₹10 each, aggregating up to ₹2,900 million.

About Quadrant Future Tek Limited

• The company was initially incorporated as ‘Quadrant Cables Private Limited’ on September 18, 2015, and later changed to ‘Quadrant Future Tek Limited’ after converting to a public limited company.
• Quadrant Future Tek Limited is focused on developing train control and signaling systems, as well as manufacturing specialty cables.
• The company is involved in the KAVACH project of the Indian Railways, which is an Automatic Train Protection system.
• The company’s manufacturing facility is located in Mohali, Punjab.
• The company also has a Railway Signalling & Embedded System Design center in Bengaluru and Hyderabad.
• The company’s promoters are Mohit Vohra, Amit Dhawan, Amrit Singh Randhawa, Rupinder Singh, Vishesh Abrol, Vivek Abrol, Aikjot Singh, and Rajbir Singh Randhawa

Financials : Quadrant Future Tek IPO

Anchors: Quadrant Future Tek IPO

• The anchor book investors include :
• Bengal Finance and Investment: Acquired 6.2 lakh shares for approximately ₹17.98 crore.
• Shine Star Build Cap: Purchased 6.08 lakh shares for about ₹17.63 crore.
• WhiteOak Capital Mutual Fund: Invested in 5.25 lakh shares through four schemes, totaling around ₹15.2 crore.
• Kotak Manufacture in India Fund: Bought 4.75 lakh shares for around ₹13.77 crore
  Other notable participants in the anchor round included LIC Mutual Fund, Bank of India Mutual Fund. Citigroup Global Markets Mauritius, Ashoka Whiteoak ICAV, Shubhkam Ventures, Capri Global Capital, PGIM India, Sundaram Alternative Opportunities Fund, The Argan Fund,
  Niveshaay Hedgehogs Fund, Vijit Growth Fund.

Salient Points:Quadrant Future Tek IPO

• It has a specialty cable manufacturing facility with an Electron Beam Irradiation Centre and end-to-end infrastructure for production of Solar and EV cables.
• 25% equity dilution post IPO.
• Use of IPO Proceeds:
  • working capital – Rs. 150 cr
  • Capex for electronic interlocking system- Rs.24 cr,
  • Debt repayment Rs. 24 cr,
• Operates in the Indian specialty cables and train control and signaling systems sectors.
• Specialty cables are utilized in railways, naval defense, solar power, and electric vehicles.
• Involved in developing Automatic Train Protection (ATP) and Automatic Train Operation (ATO) systems.
• Quadrant Future Tek has developed Train Collision Avoidance System (under KAVACH project) and received technical clearance by Research Design and Standards Organization (RDSO), Indian Railway sfor field trial and implementation of order valued at Rs. 17 cr for 5 stations and 10 locomotives.
• The company has an exclusive Memorandum of Understanding (MoU) with RailTel for delivering specific KAVACH opportunities in Indian and other countries’ railways.
• Peers ( Peers have only some common areas of operation)

• In cable manufacturing capacity utilised at present is 50%. At present cables are largely for railway applications’ Now moving into areas like renewable energy, solar cells and electric vehicles.
• Revenue from KAVACH revenue is yet to start. Due to manpower & R&D expense towards this, there has been an adverse impact on margins and so loss in H1FY25.
• Quadrant has received a purchase order from Chittaranjan Locomotive Works (CLW) for supplying, installing, testing, and commissioning Kavach equipment in 1,200 locomotives for an aggregate value of ₹9,786.06 million (including taxes)
• There is also AMC @3% pa of capital cost, for 11 years, which provides future revenue stream.
• PE FY25 (annualized) Loss. PE FY24 – 79x. However Company needs to be looked in light of Rs. 979 cr Kavach order to be executed in the coming year or so.
• I intend to apply in Quadrant Future Tek IPO. Company should benefit from MoU with RailTel for delivering specific KAVACH opportunities in Indian and other countries. The company looks well-positioned for growth given the Indian government’s focus on railway expansion and modernization and recent focus on safety due to many accidents. The large order received by company if executed will propel it to a different orbit altogether.
• GMP as per social media ruled about Rs. 220.
• This post is exploratory and educational purposes only.
• Standard disclaimer: I am not a SEBI registered analyst and above analysis is for educational purpose only. Iam a postgraduate in engineering & Management . I have in the past cleared some exams like NISM-Series-V-A: Mutual Fund Distributors Certification, NISM-Series-X-A: Investment Adviser (Level 1) Certification and NISM-Series-X-B: Investment Adviser (Level 2) Examination. This post is my view on the subject matter and is only academic and exploratory in nature. It is not meant to influence investment decisions of investors. I may have bias/vested interest in covered Stock/Mutual Funds/NCD etc. due to my own investment or leaning. Further my understanding of the areas on which I write may be imperfect or incomplete and data could be wrong due to limited time and resources at my disposal. Do check the data from company’s RHP and exchanges before making any decision. Please do your own due diligence as stock market/MF investments have high degree of inherent risk.