Mehta Hitech Industries Limited IPO

01At a glance

What the company does — manufactures CO2 laser equipment, fiber laser equipment, CNC routers and digital printers, and supplies consumables and service for them, from 13 manufacturing units in Kathwada GIDC and Sanand GIDC, Ahmedabad (DRHP p.313). It was incorporated in June 2000 as Mehta Cad Cam Systems Private Limited (DRHP p.3).

Who pays it — manufacturers and workshops across India; exports were ₹61.89 million of ₹1,522.47 million revenue in the six months to September 2025 (DRHP p.318). Gujarat was 23.60% of domestic revenue (DRHP p.317). The top ten customers were 16.82% of product and service revenue (DRHP p.59).

Why it is raising money — ₹700.00 million towards a new manufacturing facility at Sanand GIDC, ₹300.00 million for long-term working capital, and the rest for general purposes (DRHP p.149).

How fast it has grown — revenue from ₹1,544.82 million in FY23 to ₹2,561.18 million in FY25, and ₹1,522.47 million in the six months to September 2025 (DRHP p.34).

The one thing to understand — an assembler of imported laser and machine parts whose working capital is growing faster than its profit. China supplied 85.93% of raw-material imports in the six months, inventory days rose from 85 in FY23 to 108, and operating cash flow was negative ₹13.39 million in FY25 and negative ₹44.40 million in the six months (DRHP p.39, DRHP p.58, DRHP p.459).

02The business, in plain words

A machine-tool maker designs and assembles cutting, engraving, marking and printing machines, sourcing the laser sources, optics and electronics from specialist suppliers abroad, and then earns again on the consumables and service each machine needs.

A signage workshop needs to cut acrylic and metal letters → it orders a fiber laser cutter from Mehta Hitech → the company assembles it in Ahmedabad from imported laser sources and components → it installs the machine, trains staff, and keeps supplying nozzles, lenses and spare parts.

Consumables were 24.74% of revenue in the six months, and service charges 1.36% (DRHP p.313). The company sold 1,272 machines in the six months and 2,091 in FY25 (DRHP p.219, DRHP p.220).

Earnings equation: Profit ≈ machines sold × (price − imported parts and assembly cost) + consumables and service − overheads − interest. EBITDA margin was 7.60% in the six months (DRHP p.459).

03Where the money comes from

Source: DRHP p.313. Service charges and export incentives make up the rest of revenue. H1 FY26 is six months.

Source: DRHP p.317.

04The growth record

Source: DRHP p.34, DRHP p.459. H1 FY26 is six months.

05What the growth is made of

Fiber laser machines: their revenue nearly doubled from ₹598 million in FY23 to ₹1,124 million in FY25, rising from 38.71% to 43.89% of revenue (DRHP p.313). Consumables grew alongside, from ₹336 million to ₹640 million (DRHP p.313). FY25 was the strongest year for margins; EBITDA margin in the six months to September 2025 was back to 7.60% (DRHP p.459).

06Earnings quality

Profit has not turned into cash. Over FY25 and the six months the company booked ₹258.60 million of profit and had negative operating cash flow of ₹57.79 million (our arithmetic, DRHP p.459). The document lists negative operating cash flow among its top ten risks (DRHP p.39). Inventory days were 85, 92, 93 and 108 across FY23 to the six months (DRHP p.39).

Depreciation implied by the KPI table was ₹41.75 million in FY25 and ₹8.93 million in the six months (our arithmetic from EBITDA less EBIT, DRHP p.459). The pages read do not explain the drop.

The document reports late payment of statutory dues — provident fund, ESI, professional tax, TDS and GST — in 40 instances totalling ₹21.80 million in FY23, falling to 8 instances and ₹0.64 million in the six months (DRHP p.58). The auditors' reports carry an emphasis of matter on the basis of preparation of the special-purpose accounts, and the opinion is not modified (DRHP p.35, DRHP p.37).

07The balance sheet

Source: DRHP p.34, DRHP p.459.

Cash and cash equivalents were ₹4.10 million at September 2025 (DRHP p.487). Net worth rose in the six months partly from a private placement in August 2025 of 803,025 shares at ₹190 each, about ₹152.6 million (our arithmetic, DRHP p.127).

08What the money is for

Source: DRHP p.149.

The Sanand facility is estimated to cost ₹1,055.93 million, per a cost-vetting report by Infomerics Analytics and Research; ₹137.53 million is to come from borrowings, and ₹218.40 million had been spent by 30 November 2025 (DRHP p.150).

09Who is selling

Nobody. The issue is a fresh issue only, of up to 6,200,000 shares of ₹10 face value, under Regulation 6(1) (DRHP p.149).

10Promoters

The promoters are Shailesh Mehta, Sangita Shailesh Mehta, Riya Mehta, Raj Shailesh Mehta and Spectron Lasers LLP (DRHP p.31). Shailesh Mehta, the chairman and managing director, has over 25 years in the machine and tool industry (DRHP p.318). The company has one subsidiary, Mehta Mechatronix Private Limited (DRHP p.358).

11Who already owns it

Source: DRHP p.32, DRHP p.33. Raj Shailesh Mehta holds 1.43%. Promoters and promoter group hold 95.16% (DRHP p.33).

12What changed just before the IPO

• Bonus issue — 13 bonus shares for each share held, in February 2025 (DRHP p.127).
• Private placement — 803,025 shares at ₹190 to 28 allottees in August 2025 (DRHP p.127).
• Cash — operating cash flow negative in FY25 and the six months (DRHP p.459).
• Plant — ₹218.40 million already spent on the Sanand facility by November 2025 (DRHP p.150).

13Capacity and expansion

Thirteen manufacturing units in Kathwada and Sanand GIDC, all on leased land and premises, as is the registered office (DRHP p.38, DRHP p.39). Manufacturing floor area was 33,580 square metres at September 2025 (DRHP p.219). The proceeds fund a further unit at Sanand GIDC (DRHP p.149).

14Market size and industry structure

The D&B report cited in the offer document projects India's markets for CNC, laser and digital printing machines at USD 2.6 billion, 0.6 billion and 2.4 billion by FY2030 (DRHP p.31). Those projections are D&B's, and newboard has not tested them.

15Competitive position

What the document claims, and what it rests on:

• A broad product range across laser, routing and printing machines, with consumables (DRHP p.313).
• After-sales service — installation, training, maintenance and spare parts through the machine's life (DRHP p.318).
• A long record — incorporated in 2000 (DRHP p.3).

Against that: dependence on Chinese components and a few suppliers, no hedging policy, all plants in one district and on leased land, and rising inventory (DRHP p.38, DRHP p.39, DRHP p.58, DRHP p.59).

16Peers the company named

Source: DRHP p.214, DRHP p.219. Peer P/E uses prices on 28 November 2025. The peer table's EBITDA margins for MacPower (11.54%) and Jyoti (7.86%) match Mehta Hitech's own FY25 and FY24 margins rather than the peers' EBITDA and revenue in the same table, and were not used here (DRHP p.219, DRHP p.459).

No P/E is possible for the company until a price band is set.

17Risks, in plain words

• Imports. Most components come from abroad, 86% of imports from China (DRHP p.38, DRHP p.58).
• Suppliers. A limited number provide most materials (DRHP p.38).
• Currency. No hedging policy (DRHP p.59).
• Fiber lasers. 44% of revenue from one product line (DRHP p.39).
• Inventory and cash. 108 inventory days and negative operating cash flow (DRHP p.39).
• One location. All units in Ahmedabad district, on leased land (DRHP p.38, DRHP p.39).

18Litigation and regulatory matters

Source: DRHP p.37. Contingent liabilities at September 2025 were ₹130.76 million, of which ₹111.78 million was capital commitments and ₹9.02 million civil claims (DRHP p.39).

19Related-party transactions

Not read in detail for this study. Spectron Lasers LLP, a promoter, holds 27.80% (DRHP p.32).

20What the offer document does not say

In the sections read for this study, the document does not give:

• Who the component suppliers are, or how concentrated supply is, in the pages read.
• Why depreciation fell to ₹8.93 million in the six months from ₹41.75 million in FY25.
• What Spectron Lasers LLP does besides holding shares, in the pages read.
• Correct peer EBITDA margins — the peer table repeats the company's own figures.
• The price band, lot size or issue dates, which is normal at DRHP stage.

21Five questions for management

1. Which suppliers provide the laser sources and components, and how would a restriction on Chinese imports be handled?
2. Why did inventory rise to 108 days and operating cash flow turn negative?
3. Why is the six-month depreciation charge so much lower than FY25's?
4. What will the Sanand unit make, and how much capacity does it add?
5. What does Spectron Lasers LLP do, and does it trade with the company?

1Sources and cited facts

This study was read from 1 document the company filed. The 38 figures it cites are listed under the document each came from, with the page and the sentence as printed.