IPO closes on 1 Oct'25
Fabtech Technologies Ltd
Minimum Investment
₹ 14,325 / 75 shares
Our Verdict:
Avoid
- Fabtech Technologies Ltd (FTL) has posted strong revenue and earnings growth over the past three years. Its order book, at nearly 3x FY25 revenue, provides good visibility for future growth.
- Valuations also appear attractive, with the IPO priced at a P/E multiple of 13x.
- That said, there are important risks to consider. Only 11% of proposals have converted into firm orders over the last three years, highlighting a low conversion rate. Cash flows remain volatile, while margins and return ratios lack consistency.
- In addition, around 60% of revenue comes from the MENA (Middle East North Africa) and GCC (Gulf Cooperation Council) regions, exposing the company to significant geographic concentration risk.
- Overall, the risks currently outweigh the positives, making it prudent to avoid this IPO at this stage.
About the company
Founded in
26 Oct'18
Managing director
Hemant Anavkar
- FTL is a turnkey pharma engineering solutions provider, involved in building capabilities for the pharmaceutical, biotech and healthcare industries by delivering complete end-to-end solutions. The company focuses on select pharmaceutical equipment and caters to a wide and diverse customer base.
- To deliver turnkey engineering solutions, FTL follows an export-oriented, asset-light model. Under this approach, it procures equipment from related entities and provides a full range of services, including design, engineering, procurement, installation and testing.
STRENGTHS
- Global Presence: FTL operates in over 62 countries across the Middle East, Africa, Asia, Europe, Latin America and North America. It has presence in key emerging economies such as Bangladesh, Egypt, Ethiopia, India, Kenya, Saudi Arabia, Morocco, Nicaragua, Nigeria, South Africa, Turkey, UAE, USA and Tanzania. This diversified presence ensures multiple growth avenues.
- Solid Performance: From FY23 to FY25, FTL achieved impressive growth, with operating revenue growing at a 30% CAGR, EBITDA increasing by 21% and net profit surging by 46%.
- Strong Order Book: As of 31 July 2025, FTL reported an order book of Rs 904.41 crore, which is nearly 3x FY25 revenue (Rs 326.7 crore) — offering a strong growth runway.
- Robust Return Metrics: FTL boasts a Return on Equity of 30.46% and a Return of Capital Employed of 24.46%, reflecting its ability to generate significant shareholder value and deploy capital efficiently.
RISK FACTORS
- Low Order Conversion: In the last three fiscal years, the actual orders received by FTL accounted for less than 11% of the total value of proposals submitted. A prolonged inability to generate or convert leads into confirmed orders could adversely impact the company’s business and operating results.
- Revenue Concentration: FTL derives a substantial portion of its revenue from a limited number of projects in its order book. In FY25, the top 5 projects contributed 56% and the top 10 projects contributed 74% of total revenue. Cancellation or delay of any key project could materially affect business performance, financial condition, and results of operations.
- Trade Receivables: As of March 31, 2025, trade receivables exceeding six months from their due dates stood at Rs 84.90 crore, representing 55.62% of total receivables on a consolidated basis. Failure to collect receivables in a timely manner may adversely affect liquidity, business operations and cash flows.
- Geographic Concentration: In FY25, nearly 50% of revenue was derived from the GCC region and another 10% from the broader MENA region. The company’s reliance on these geographies exposes it to regional economic, political and regulatory risks.
- Cash Flow Pressure: FTL has reported negative cash flow from operations in FY25 and FY23. Prolonged negative cash flows could negatively affect its overall financial stability.
Financials
All Values are in Cr.
Issue details
Issue type
Mainstream
Issue size
₹ 230.35 crore
Fresh Issue
₹ 230.35 crore
OFS
₹ -
Price range
₹ 181 - 191
Lot size
75 shares
Issue Objective
The net proceeds from the fresh issue will be utilized for the following purposes:
- Meeting the company’s working capital requirements;
- Pursuing inorganic growth opportunities through strategic acquisitions; and
- General corporate purposes.
Dates
Bidding open
29 Sep'25
Bidding close
1 Oct'25
Allotment date
3 Oct'25
Refund date
6 Oct'25
Listing
7 Oct'25
IPO Reservations
Qualified institutional buyers
<50%
Non-institutional investors
>15%
Retail individual investors
>35%
Read the Offer Document
© 2025 by Liquide Solutions Private Limited, SEBI Registered Research Analyst (Registration number - INH000009816)
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