Vikran Engineering IPO—Here are 5 key risks from the RHP investors should know before subscribing

Vikran Engineering IPO—Here are 5 key risks investors should know before subscribing. The issue opens for subscription on August 26, 2025, and ends on August 29, 2025.

Vikran Engineering IPO: Key risks

1. Vikran Engineering projects have been completed either ahead of schedule or within the contractual time periods. The majority of projects have been awarded through a competitive bidding process. Failure to complete its projects within contractual time may affect its future business prospects and financial performance. Failure to qualify for, complete, or win new contracts could negatively impact its business, potentially affecting its financial condition, operational results, growth prospects, and cash flow stability.

2. Vikran Engineering business is driven by a diversified mix of tenders from government authorities, public sector undertakings, and private sectors, which account for approximately 46.45%, 21.03%, and 32.52% of its revenue for Fiscal 2024. However, delays or a lack of tenders from government entities, along with adverse changes in government policies, could materially impact its business through contract foreclosures, terminations, restructurings, or renegotiations, affecting our operations and financial performance.

3. Vikran Engineering has an order book of ₹ 19,557 million as of August 31, 2024. However, its order book may not be representative of its future results, as projects included in its order book, particularly for the projects where it is the lowest bidder, may be cancelled, modified, or delayed beyond its control, leading to significant deviations from estimated income and adversely affecting its business, reputation, financial condition, and future prospects.

4. Contribution of its top customers has been diversified over the period. However, a significant portion of our Order Book and revenue from operations is attributable to certain key customers and to projects located in India, and its business and profitability is dependent on its ability to win projects from such customers

5. The majority of its order book and its revenues are from the power transmission and distribution sector and the water infrastructure sector. Significant social, political, or economic changes in the power transmission and distribution sector could adversely affect its business, results of operations, financial condition, and cash flows.

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