About Eppeltone Engineers Limited

BUSINESS OVERVIEW

Eppeltone Engineers, established in 1977 as a proprietorship concern, began by manufacturing Switch Mode Power Supply (SMPS) for personal computers and electronic devices. Over the years, the company diversified into power conditioning devices including AVRs, UPS systems, and transducers. It operates primarily in the Business-to-Business (B2B) segment, with a strong focus on serving Government Entities, electricity distribution utilities, institutional buyers, AMISPs, and turnkey contractors, as well as select private sector clients.

The company is engaged in the design, manufacturing, and supply of Static Watt Hour Meters, Smart Meters (as per BIS 16444), Water Meters, BPL Kits, UPS systems, LED-based luminaires, battery management systems, battery chargers and packs, and various railway and utility components like underslung chargers, short neutral section assemblies, modular cantilevers, and enclosures.

In 1990, three manufacturing units were established at Parwanoo, Himachal Pradesh, and Okhla, New Delhi. In 2014, operations expanded to include energy-efficient LED products in response to resource scarcity. In 2016, the energy meter division shifted to Greater Noida, Uttar Pradesh, to meet growing demand from electric grids and PSU clients across India. The company emphasizes customized, high-performance solutions, collecting and analyzing customer data to deliver bespoke systems. It manufactures both finished and intermediate-stage products, tailored to demand.

A single modern plant now oversees production, ensuring streamlined operations, consistent product quality, and a commitment to helping the power sector reduce Aggregate Technical & Commercial (AT&C) losses — a key driver for enhanced revenue and service quality in the utilities sector. As on March 31, 2024, the company have 59 permanent employees. The Banker to the Company is HDFC Bank Limited.

INDUSTRY ANALYSIS

Electricity Sector Overview in India

Installed Generation Capacity

India’s electricity demand has surged due to rapid urbanization and industrialization, driving up both consumer numbers and per capita consumption. As of January 2024, India’s installed generation capacity stood at 430 GW, growing at a CAGR of 4% (FY2019–2023). Thermal power (mainly coal) dominates with 56% share, while renewables now contribute 31%. Private players hold 33% of the capacity, with the rest split between state and central governments.

Electricity Demand & Supply Gap

Annual demand reached 1,512 BU in FY23, up at a 3.5% CAGR from FY2019. However, generation stood at 1,504 BU, leading to a 7.6 BU deficit. Peak demand hit 216 GW in FY23, outpacing supply (207 GW). By January 2024, peak demand rose to 243 GW, with supply at 240 GW. The peak demand CAGR stood at 5.6% over five years.

Future Electricity Demand

India’s electricity demand is projected to rise to 1,907 BU by FY27 and 2,473 BU by FY32, while peak demand is expected to reach 277 GW (FY27) and 366 GW (FY32). To meet this, an additional 63 GW capacity is needed by FY27, and 233 GW between FY27–32.

Consumer Base & Metering Infrastructure

Consumer Base Growth

Between FY2021–2023, India’s electricity consumer base steadily grew, adding over 1.6 million connections. Domestic users dominate with 79.5%, followed by commercial (8.7%), agriculture (8.4%), and industrial (1.7%).

Smart Meter Rollout

Smart meters, key components of the Advanced Metering Infrastructure (AMI), enable real-time energy monitoring. India aims to replace 250 million conventional meters by FY2026 under the RDSS scheme. As of January 2024, 222.3 million smart meters were sanctioned, 108.1 million tendered, and 8.6 million installed.

Uttar Pradesh leads with 29% of tendered and 14% of installed meters. However, overall installation progress remains nascent—only 3% of total meters replaced.

Benefits & Challenges

Smart meters reduce AT&C losses, curb theft, improve billing efficiency, and enable better grid management. They support dynamic pricing, demand-side management, and integration of renewables—key to India’s net-zero 2070 and 50% renewable energy by 2050 targets.

Main challenge: consumer resistance to prepaid meters, especially due to subsidized tariffs and a long-standing perception of cheap electricity. Changing this mindset is crucial for large-scale adoption.

Growth Prospects & Competitive Landscape

India's smart meter drive is gaining momentum, with installations in FY2024 nearly doubling from the previous year. With 143.8 million meters tendered and more in the pipeline, the growth outlook is strong, especially with the rise of EVs, which will require efficient load management.

Key players include:

• Global: L&T, Siemens, Schneider

• Domestic: Genus Power, HPL Electric

• Tech providers: Itron, Analog Devices

Cost competitiveness, tech innovation (e.g., tamper detection, cybersecurity), and strong DISCOM ties are critical to winning contracts. Domestic firms leverage the “Make in India” initiative, while partnerships between global and local players are reshaping the competitive dynamics.

Conclusion

India’s electricity sector is undergoing a major transformation. The push for smart metering is central to building a resilient, transparent, and future-ready grid. While progress has begun, significant ground remains to be covered—especially in consumer adoption, execution speed, and infrastructure readiness—to achieve the ambitious 2027 targets.

BUSINESS STRENGTHS

1. Strong and Innovative Product Technology
Eppeltone Engineers leverages core technologies and original ideas to deliver value-added solutions. In 1999, the company expanded into energy meter manufacturing aligned with the Government of India’s infrastructure initiatives.

2. Experienced Leadership and Skilled Workforce
Led by promoters Rohit Chowdhary and Deven Chowdhary, with over 20 years of industry experience, the company benefits from a capable management team and well-trained personnel, enabling strategic growth and operational efficiency.

3. High Quality and Service Standards
A strong emphasis on quality control ensures that products consistently meet global standards, enhancing customer satisfaction and building long-term trust.

4. Robust Supplier Network
Well-established supplier relationships enable timely procurement of quality materials, contributing to efficient inventory management and on-time delivery.

5. Stable and Trusted Customer Base
The company maintains long-standing relationships with numerous state utilities, DISCOMs, and central PSUs, with approvals from over 30 government entities and multiple private turnkey contractors across India.

6. Diverse Product and Service Portfolio
With a broad and expanding range of products and turnkey solutions, including customizations for institutional and corporate clients, Eppeltone Engineers caters to a wide and diversified customer base.

BUSINESS STRATEGIES

1. Geographical Expansion
Focused on strengthening presence across more Indian states and entering international markets to meet rising demand and expand the existing customer base.

2. Product Portfolio Diversification
Plans to introduce value-added products, including Gas Meters and Water Meters, leveraging existing capabilities to meet evolving market needs.

3. Enhancing Operational Efficiency
Continuous efforts to improve processes, reduce costs, and enhance customer satisfaction through skill upgrades and organizational alignment.

4. Working Capital Optimization
Targeting shorter working capital cycles and improved inventory management to boost margins in a competitive market landscape.

5. Focus on Quality Assurance
Commitment to national and international quality standards to ensure repeat business, strengthen brand reputation, and unlock further growth opportunities.

BUSINESS RISK FACTORS & CONCERNS

1. Geographical Revenue Concentration
A substantial portion of revenue is generated from select Indian states. Any adverse political, regulatory, or competitive developments in these regions may negatively impact overall business performance.

2. Dependence on Government Tenders
A significant share of contracts is secured through government tenders. Failure to win or renew such contracts may adversely affect business operations and financial health.

3. High Customer Concentration
Top ten customers contribute over 89% of total sales in recent years. The absence of long-term agreements with these clients increases the risk of revenue volatility if any key customer reduces or discontinues business.

4. Performance Obligations and Compliance Risks
Contracts are subject to strict quality and performance standards. Failure to meet these can result in penalties, contract termination, reputational damage, or financial liabilities, including indemnities and liquidated damages.

Eppeltone Engineers faces risks related to geographical revenue concentration, dependence on government tenders, customer concentration, and performance-linked liabilities, all of which could impact its revenues, profitability, and financial stability.