Smarten Power Systems IPO Opens at ₹100 with ₹50 Crore Issue

Smarten Power Systems Limited, a well-known name in the power backup and advanced solar power products sector, has launched its ₹50 crore IPO on the NSE SME platform.

This IPO is a Fixed Price Issue with a share price set at ₹100 per equity share. The issue consists of:

• Fresh Issue: 40 lakh shares worth ₹40 crore.

• Offer for Sale (OFS): 9.99 lakh shares worth ₹10 crore.

The IPO subscription window is open from July 7 to July 9, 2025. The allotment finalisation is expected on July 10, 2025 with a tentative listing date on July 14, 2025.

Arihant Capital Markets Limited is the Book Running Lead Manager and Market Maker, while Maashitla Securities Private Limited acts as the Registrar for the issue.

Price, Lot Size and Investor Requirements

The fixed price of ₹100 per share gives the company a post-issue market capitalisation of ₹190 crore.

For retail investors:

• Lot size: 1,200 shares.

• Minimum investment: 2 lots (2,400 shares) = ₹2,40,000.

This relatively high minimum amount is standard for NSE SME listings, aimed at serious investors familiar with SME risk-reward dynamics.

Grey Market Premium (GMP): Zero Demand Signal

As of the latest update on 02 July 2025, the Grey Market Premium (GMP) for Smarten Power Systems IPO is ₹0.

This flat GMP suggests no informal premium trading and signals limited or cautious demand among grey market investors.

Key Points About GMP:

• GMP is an unofficial indicator used to gauge pre-listing sentiment.

• Zero GMP suggests no speculative frenzy.

• It does not guarantee listing price outcomes.

Investors should be cautious: GMP is purely informal and can change rapidly based on late demand or broader market trends.

Live Subscription Status Shows 1.56x Demand

According to NSE SME portal data at 11:30 AM on July 9, 2025, the Smarten Power Systems IPO was subscribed 1.56 times overall on the final day of bidding.

This reflects moderate demand, with retail and NII participation pushing the issue beyond its base size but without the 10x+ oversubscription sometimes seen in SME IPOs.

Key drivers of this subscription rate:

• Reasonable issue size (₹50 crore).

• Sector relevance (power backup and solar energy).

• Balanced structure with fresh + OFS.

However, the lack of GMP enthusiasm suggests investors are being cautious, perhaps waiting to see how listing demand shapes up.

Business Overview: Solar and Power Backup Focus

Smarten Power Systems designs, assembles, and trades in power backup and advanced solar power products, with a strong focus on:

• Home UPS systems.

• Solar inverters.

• Solar Power Conditioning Units (PCUs).

• Solar charge controllers.

• Trading of solar panels and batteries.

Their business model relies on Indian distribution networks for domestic sales and exports (excluding panels) for overseas markets.

Promoter Experience and Business Vision

The company is promoted by four experienced individuals:

• Arun Bhardwaj

• Rajnish Sharma

• Ravi Dutt

• Tirath Singh Khaira

They have an average of more than two decades of experience in the power-backup industry, bringing deep domain knowledge and market insight.

Their mission: Provide efficient, low-cost power solutions by assembling and trading reliable products to meet India’s rising demand for clean and backup energy solutions.

Financial Performance: Consistent Growth Track Record

Smarten Power Systems has demonstrated steady growth over the last three years:

Revenue from Operations:

• FY23: ₹186.06 crore

• FY24: ₹198.73 crore

• FY25: ₹203.19 crore

EBITDA:

• FY23: ₹7.99 crore

• FY24: ₹17.08 crore

• FY25: ₹18.36 crore

Profit After Tax (PAT):

• FY23: ₹5.15 crore

• FY24: ₹11.29 crore

• FY25: ₹12.77 crore

This clear upward trajectory reflects:

• Stable domestic demand for backup solutions.

• Growing exports (excluding solar panels).

• Operational efficiency improvements.

Valuation Metrics and Profitability Ratios

Pre-issue EPS: ₹8.51
Post-issue EPS: ₹6.72
Pre-issue P/E ratio: 11.75x
Post-issue P/E ratio: 14.88x
Industry P/E ratio: 42x

Profitability Metrics for FY24:

• ROCE: 32.58%

• ROE: 39.72%

• RoNW: 33.14%

Analysis:
These ratios show the IPO is fairly priced relative to industry averages, though it commands a premium post-issue due to share dilution.

Objectives of the Issue: Detailed Use of Funds

Net proceeds will fund:

• ₹418.90 lakh for production line movable assets (battery manufacturing).

• ₹2,200 lakh for working capital.

• ₹95 lakh for partial/full debt repayment.

• ₹446.15 lakh for capital expenditure.

• ₹469.91 lakh for general corporate purposes.

This breakdown highlights a strong focus on expansion and operational scaling, key for long-term growth in the solar and power backup sector.

Risks and Challenges for Investors

• High minimum investment for retail investors (₹2,40,000 for 2 lots).

• Flat GMP suggests cautious demand, limited speculative upside.

• SME platform listing often has lower liquidity than mainboard IPOs.

• Dependence on distributor sales, exposed to credit risk and demand fluctuations.

• Export business limited to non-panel products, constraining growth scale.

• Competition from established domestic and multinational brands in solar/UPS markets.

IPO Recommendation: Avoid for Listing Gains

Given the GMP of ₹0, limited oversubscription, and SME market dynamics, analysts recommend caution.

For listing gain seekers, this IPO does not appear attractive due to:

• No meaningful premium in the grey market.

• High lot size restricting small retail participation.

• Potential listing at or near issue price, offering limited upside.

Longer-term investors may still evaluate it for exposure to the solar and power-backup theme, but should carefully review financials, order book strength, and post-listing liquidity.

Allotment and Listing Process: Key Dates

• Issue Closes: July 9, 2025.

• Allotment Finalisation: Expected on July 10, 2025.

• Listing Date: Tentatively July 14, 2025 on NSE SME.

How to Check Allotment Status:

• Go to the Registrar’s IPO Allotment Status page.

• Select Smarten Power Systems IPO.

• Enter Application Number, PAN, or DP Client ID.

• Submit details to view status online.

Conclusion

Smarten Power Systems Limited IPO offers a ₹50 crore opportunity in the solar and power backup space, but with no grey market premium and high entry cost for retail investors, the listing gain potential is limited.

Recommendation: Investors focused on listing gains should consider avoiding this IPO.

Those with a long-term view on India’s renewable energy and power backup demand can review fundamentals carefully before making an allocation decision.

Final verdict: Cautious approach advised, with close monitoring of final day subscription data and post-listing liquidity conditions.

Disclaimer:

This article is intended for informational and educational purposes only and does not constitute investment advice. Readers are advised to consult their financial advisor before making any investment decisions. Investments in securities are subject to market risks. Please read all related documents carefully before applying for the IPO. The data provided is based on publicly available information and may be subject to change.

The Upcoming IPOs in this week and coming weeks are Monika Alcobev, NSDL, Anthem Biosciences, Spunweb Nonwoven.

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