Rays Power Infra Limited IPO

01At a glance

What the company does — develops "ready-to-build" infrastructure for utility-scale renewable power projects under a co-development model, and builds solar plants as an EPC contractor (DRHP p.31). Its order book was ₹80,342.61 million at 31 July 2025, across 30 contracted projects (DRHP p.31).

Who pays it — solar project developers; the top three customers were 51.12% of FY25 revenue (DRHP p.36). Karnataka was 58.00% of the projects under execution, Rajasthan 14.69% and Madhya Pradesh 13.27% (DRHP p.36).

Why it is raising money — ₹5,000.00 million for its subsidiary Rays Green Energy Manufacturing to part-finance a 1.5 GW TOPCon solar cell plant at Narmadapuram, Madhya Pradesh, ₹2,000.00 million for working capital, and the rest for general purposes (DRHP p.162).

How fast it has grown — revenue from ₹7,766 million in FY23 to ₹10,488 million in FY24 and ₹12,206 million in FY25 (DRHP p.35).

The one thing to understand — profits have not come with cash. Operating cash flow was negative ₹702.36 million in FY23, ₹228.94 million in FY24 and ₹696.18 million in FY25, and net working capital went from negative 6 days to 138 days (DRHP p.51, DRHP p.190).

02The business, in plain words

A solar co-developer prepares ready-to-build sites for renewable power projects; as an EPC contractor it also builds the plants.

A power developer wins a solar tender → it hires Rays to arrange land and grid connection and then to build the plant → Rays delivers the site and constructs the plant → it bills milestones and waits for payment.

EPC was 65.66% of FY25 revenue, up from 37.91% in FY23 (DRHP p.36).

Earnings equation: Profit ≈ contract value × (margin over land, modules and construction cost) − overheads. Operating EBITDA margin was 15.91% in FY25 (DRHP p.190).

03Where the money comes from

Source: DRHP p.36.

Revenue from the co-development and EPC businesses rose from ₹7,350.77 million in FY24 to ₹11,121.75 million in FY25; the rest of revenue, other operating income, was ₹3,137 million in FY24 and ₹1,085 million in FY25 (DRHP p.190, our arithmetic).

04The growth record

Source: DRHP p.35, DRHP p.51, DRHP p.190.

05What the growth is made of

The EPC business. Its share of revenue rose from 38% to 66%, and core revenue grew 51.30% in FY25 (DRHP p.36, DRHP p.190). FY23 profit of ₹1,289.90 million included items the company excludes in its adjusted figure of ₹336.28 million (DRHP p.190).

06Earnings quality

Profit of ₹3,597.26 million over FY23 to FY25 came with negative operating cash flow of ₹1,627.48 million (our arithmetic, DRHP p.35, DRHP p.51). Net working capital rose from negative 6 days in FY23 to 138 days in FY25 (DRHP p.190). There are no auditor qualifications not given effect in the restated accounts (DRHP p.35).

07The balance sheet

Source: DRHP p.35, DRHP p.190.

Current borrowings rose from ₹167.07 million in FY23 to ₹2,441.05 million in FY25 (DRHP p.35).

08What the money is for

Source: DRHP p.162. The cell plant is to cost ₹9,211.70 million in all, with ₹3,221.70 million from secured loans (DRHP p.29).

09Who is selling

Source: DRHP p.31, DRHP p.32, DRHP p.33.

10Promoters

The promoters are Ketan Mehta, Pawan Kumar Sharma, Sanjay Garudapally, Sweta Mehta, Richa Sharma, Shruthi Gupta Garudapally, Mehta Family Trustee Private Limited and three family trusts (DRHP p.31). Proceedings against the promoters include 4 criminal and 11 tax matters (DRHP p.36).

11Who already owns it

Source: DRHP p.33. The last two rows are our arithmetic; others is 100% less the promoters' 89.74% (DRHP p.33).

12What changed just before the IPO

• Order book — ₹80,343 million at July 2025, about 6.6 times FY25 revenue (DRHP p.31, our arithmetic).
• Working capital — 138 days in FY25 (DRHP p.190).
• Borrowings — nearly doubled in FY25 (DRHP p.35).
• Manufacturing — a planned move into solar cells (DRHP p.162).

13Capacity and expansion

The document describes an asset-light business model (DRHP p.185); the proceeds fund a 1.5 GW TOPCon cell plant through a subsidiary (DRHP p.162). The document warns the cells may not be included in the government's approved list of manufacturers, which customers need for domestic-content projects (DRHP p.29).

14Market size and industry structure

The CRISIL report cited in the offer document expects 170–180 GW of solar capacity to be added between FY2026 and FY2030 and ₹11–12 trillion to be invested in solar over that period (DRHP p.31). Those projections are CRISIL's, and newboard has not tested them.

15Competitive position

What the document claims, and what it rests on:

• A pioneer of solar co-development in India, citing CRISIL (DRHP p.31).
• A large order book relative to revenue, citing CRISIL (DRHP p.185).

Against that: three customers for half of revenue, projects concentrated in Karnataka, negative operating cash flow, and a first venture into manufacturing (DRHP p.29, DRHP p.36).

16Peers the company named

The document gives the listed peers' P/E range as 43.34 to 69.50, and an average of 27.57, below the lowest figure shown (DRHP p.186). The full peer table was not read for this study.

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

17Risks, in plain words

• EPC execution. Two-thirds of revenue (DRHP p.36).
• Customers. Three customers were half of revenue (DRHP p.36).
• Karnataka. 58% of projects under execution (DRHP p.36).
• Cash flow. Negative in each of the last three years (DRHP p.51).
• Cell plant. Approval and market risks (DRHP p.29).

18Litigation and regulatory matters

Source: DRHP p.35, DRHP p.36. Three criminal and three regulatory proceedings are pending against key managerial personnel and senior management (DRHP p.36).

19Related-party transactions

Not read in detail for this study.

20What the offer document does not say

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

• What the ₹3,137 million of other operating income in FY24 was, in the pages read.
• What FY23 items were excluded to reach adjusted profit, in the pages read.
• Why working capital rose to 138 days, in the pages read.
• A peer P/E average consistent with the range shown (DRHP p.186).
• The price band, lot size or issue dates, which is normal at DRHP stage.

21Five questions for management

1. Why has operating cash flow been negative for three years while profit rose?
2. What made up FY24's ₹3,137 million of other operating income?
3. Who are the top three customers, and how quickly do they pay?
4. Why build a cell factory, and who will take its output?
5. What are the criminal proceedings against the promoters and senior managers?

1Sources and cited facts

This study was read from 1 document the company filed. The 32 figures it cites are listed under the document each came from, with the page and the sentence as printed.