Tonbo Imaging India Limited IPO

01At a glance

Tonbo Imaging India IPO date, price band and lot size

• Price band: ₹665 to ₹700 a share, from NSE's issue page; the prospectus leaves the price blank (RHP p.3).
• Lot size: 21 shares, from NSE's issue page; one lot costs ₹14,700 at the upper band (our arithmetic).
• Dates: anchor bidding on October 14, 2026; the issue opens on October 15, 2026 and closes on October 19, 2026 (RHP p.2).
• Size: an offer for sale of up to 12,174,046 shares by 13 selling shareholders and no fresh issue (RHP p.3), about ₹852.2 crore at the upper band and ₹809.6 crore at the lower band (our arithmetic, RHP p.89).
• Who gets the shares: not more than 50% of the net offer for qualified institutional buyers, not less than 15% for non-institutional investors and not less than 35% for retail individual investors, with up to 14,000 shares reserved for employees (RHP p.3).
• Lead managers and registrar: JM Financial Limited and IIFL Capital Services Limited; KFin Technologies Limited is the registrar (RHP p.2). No monitoring agency is needed because the company raises nothing (RHP p.108).

What the company does: designs and develops electro-optical and infrared equipment for armed forces and security agencies, including thermal imaging cores, weapon sights, hand-held thermal binoculars, targeting systems, missile seekers and fire control systems (RHP p.251).

Who pays it: armies, police and paramilitary forces and defence system integrators in India and abroad; the Indian government was 71.19% of FY26 revenue (RHP p.255). Customers are not named, for confidentiality (RHP p.29).

Why it is raising money: it is not. The whole issue is a sale by existing shareholders, who receive the proceeds after their share of expenses (RHP p.139).

How fast it has grown: revenue from operations was ₹428.2 crore in FY24, ₹469.1 crore in FY25 and ₹362.6 crore in FY26, and profit after tax ₹68.5 crore, ₹72.8 crore and ₹50.9 crore (RHP p.94); our arithmetic puts the yearly change at about −8.0% for revenue and −13.8% for profit (our arithmetic, RHP p.94).

The one thing to understand: revenue rests on a few large defence orders. One customer, in Armenia, was 57.07% of FY25 revenue and did not order again (RHP p.29, RHP p.439), and the company lost ₹17.7 crore in the three months to June 2026 (RHP p.94). Working capital stood at 517 days of activity in FY26 (RHP p.149).

02The business, in plain words

What Tonbo Imaging India does

The company was incorporated in Bengaluru on December 18, 2003 as Sarnoff Innovative Technologies Private Limited, took its present name in 2016 and became a public company, Tonbo Imaging India Limited, with a certificate dated September 11, 2025 (RHP p.3). It began as a subsidiary of a research company and turned to defence products in 2012 after the promoters bought it out (RHP p.252).

What it sells, share of FY26 revenue (RHP p.253):

• Tactical systems: sights and binoculars carried by soldiers, 58.37%.
• Platform systems: equipment built into vehicles, remote weapon stations, missiles and surveillance platforms, 39.93%.
• Others and other operating revenue: component sales, support and similar items, 1.70% together.

An army or a defence integrator needs thermal sights → it runs a tender, which the company bids for → the company designs the product, builds pilot units at its Bengaluru R&D centre and orders volume production from Kaynes Technology India Limited and Avalon Technology and Services Private Limited → it delivers and is paid after acceptance (RHP p.256, RHP p.276).

The company says over 28,000 of its systems are deployed in 24 countries, and that its products are free of US ITAR export restrictions (RHP p.251). It bought all its intellectual property from CEAQ Technologies Pte. Ltd., a shareholder, under agreements dated March 11, 2024 (RHP p.251). It had 339 permanent employees at June 30, 2026, 130 of them R&D engineers (RHP p.281, RHP p.256).

Earnings equation: Revenue ≈ orders won in tenders × share of the order book delivered in the year. The confirmed order book was ₹279.0 crore at March 2026 and ₹314.2 crore at June 2026 (RHP p.149). The prospectus gives no unit volumes or prices.

03Where the money comes from

By where the customer is, share of revenue (RHP p.32):

The rest is other operating revenue (RHP p.32). Exports were 48.61%, 65.52% and 5.57% of revenue in FY24 to FY26 (RHP p.149).

By type of customer, FY26 (RHP p.255, RHP p.256):

• Indian government 71.19%, private system integrators 24.10%, foreign governments 3.34%.
• In FY25 foreign governments were 57.07% (RHP p.256).

Tonbo Imaging India customers: how concentrated the revenue is

Source: RHP p.29. The same customer was the largest in FY24 and FY25 but not in FY26 (RHP p.29). The company had 25, 30 and 44 customers in FY24 to FY26 and 12 in the three months to June 2026 (RHP p.32). Read from the filing: revenue does depend on a few customers; in FY26 the top five gave about half of it, and in FY25 one customer gave more than half.

That customer was in Armenia: a US$55 million order received in FY24 brought ₹188.9 crore of revenue in FY24 and ₹267.7 crore in FY25 (RHP p.439). Revenue from Europe fell to 0.13% in FY26 because that customer placed no order in FY25 or FY26 (RHP p.32).

04The growth record

Tonbo Imaging India financials: revenue, profit and margins

Source: RHP p.92, RHP p.94, RHP p.95, RHP p.149. The three-month figures are not annualised.

Source: RHP p.149.

Our arithmetic over FY24 to FY26 (RHP p.94, RHP p.149):

• Revenue changed about −8.0% a year (our arithmetic, RHP p.94).
• EBITDA changed about −3.5% a year (our arithmetic, RHP p.149).
• Profit after tax changed about −13.8% a year (our arithmetic, RHP p.94).
• EBITDA margin rose 262 basis points, so 26.2% → 28.9% rounded (RHP p.149); PAT margin fell 212 basis points.

Revenue grew 342.22% in FY24, 9.55% in FY25 and fell 22.69% in FY26 (RHP p.149).

What sits around the record:

• Size: revenue went ₹428.2 cr → ₹362.6 cr from FY24 to FY26 (RHP p.94), and profit after tax ₹68.5 cr → ₹50.9 cr (RHP p.94).
• The latest quarter: a loss of ₹17.7 crore in the three months to June 2026 (RHP p.94), which the company puts down to low revenue and seasonality while staff costs and depreciation run evenly through the year (RHP p.28).
• Cash: operating cash flow was −₹63.2 crore in FY26 (RHP p.95). Over FY24 to FY26 it was an outflow of ₹121.0 crore against profit of ₹192.2 crore (our arithmetic, RHP p.95, RHP p.94).
• Other income was ₹7.3 crore in FY26, about 10.4% of profit before tax (our arithmetic, RHP p.94).
• Warranty write-back: FY26 other expenses were lowered by a write-back of warranty provisions of ₹18.8 crore (RHP p.438), about 26.9% of FY26 profit before tax (our arithmetic, RHP p.94).
• Customers: the largest customer was 13.8% of FY26 revenue (RHP p.29) and the top five 53.0% of FY26 revenue (RHP p.29); in FY25 the largest was 57.1% of FY25 revenue (RHP p.29). India was 93.1% of FY26 revenue (RHP p.32).
• Working capital: 517 days in FY26, against 152 in FY24 (RHP p.149).
• Debt: borrowings were ₹116.1 crore at March 2026 (RHP p.92); the company's own net debt to EBITDA was 0.7× in FY26 (RHP p.403). Return on capital employed was 14.5% in FY26 (RHP p.149).
• Dealings with CEAQ Singapore: the company bought its intellectual property from CEAQ Technologies Pte. Ltd. for ₹183.2 crore (RHP p.277), and bought ₹79.0 crore of project materials from it in FY26 (RHP p.99).
• Contingent liabilities: bank guarantees of ₹78.9 crore at June 30, 2026 (RHP p.97).
• Cases against promoters: one civil suit, in the Singapore High Court, names Arvind Kondangi Lakshmikumar (RHP p.455); section 23 has the detail.
• Pre-IPO share sales: CEAQ Technologies Private Limited and CEAQ Technologies Pte. Ltd. sold 5,911,200 shares at ₹700 to institutions and others on September 29 and 30, 2026 (RHP p.122, RHP p.123), about ₹413.8 crore (our arithmetic).
• The issue: no fresh issue (RHP p.89); the offer for sale is about ₹852.2 crore at the upper band (our arithmetic, RHP p.89).
• Valuation at the upper band: a market capitalisation of ₹4,009.7 crore (our arithmetic, RHP p.89) and a P/E of 78.8× on FY26 profit after tax on the share count after the issue (our arithmetic, RHP p.89, RHP p.94). The median P/E of the five peers the prospectus names is 83.9× (our arithmetic, RHP p.146), so the issue is −6% against the peer median (our arithmetic, RHP p.146). Section 16 has the detail.
• Industry: defence electronics, defence and aerospace in the fixed list (RHP p.251).

05What the growth is made of

The prospectus explains the record this way:

• FY25: up 9.55%, mainly from exports, which rose from ₹208.1 crore to ₹307.3 crore (RHP p.439).
• FY26: down 22.69%, put down to delays in executing some international orders because of the West Asia conflict and to some expected orders moving into FY27 (RHP p.437). An order of ₹51.4 crore received in FY26 could not be delivered that year and is in the June 2026 order book (RHP p.437).

By product (RHP p.253):

• Tactical systems: ₹359.3 crore in FY24, ₹362.3 crore in FY25, ₹211.7 crore in FY26.
• Platform systems: ₹12.7 crore, ₹101.1 crore, ₹144.8 crore.

Indian government revenue went from ₹163.4 crore in FY24 to ₹258.2 crore in FY26 (RHP p.255). Bids won were 27, 23 and 45 in FY24 to FY26, out of 66, 64 and 131 submitted (RHP p.28).

Order book, ₹ crore (RHP p.149):

Orders of ₹118.2 crore were received from July 1 to September 30, 2026 (RHP p.255). The offer document does not disclose unit volumes or prices, so the change in revenue cannot be separated into volume and price.

06Earnings quality

The item that needs explaining is working capital. Inventory went from ₹111.1 crore at March 2025 to ₹219.5 crore at March 2026 and ₹319.6 crore at June 2026 (RHP p.92). The company says it bought components early for FY27 orders and that delayed international orders added to stock (RHP p.30). Trade receivables were ₹211.7 crore at March 2026 against FY26 revenue of ₹362.6 crore (RHP p.92, RHP p.94).

07The balance sheet

At March 31, 2026 (RHP p.92):

• Intangible assets ₹162.7 crore, mostly the intellectual property bought from CEAQ Singapore.
• Inventories ₹219.5 crore; trade receivables ₹211.7 crore.
• Cash ₹16.2 crore and other bank balances ₹22.5 crore.
• Short-term borrowings ₹116.1 crore; no long-term borrowings.
• Total assets ₹782.5 crore; net worth ₹553.2 crore.

At June 30, 2026, inventories were ₹319.6 crore, receivables ₹96.9 crore and short-term borrowings ₹129.7 crore (RHP p.92).

At August 31, 2026, fund-based borrowings outstanding were ₹167.2 crore, of which ₹145.7 crore working capital and ₹21.5 crore term loans, with bank guarantees of ₹79.0 crore, from Axis Bank, EXIM Bank and HDFC Bank at 7.50% to 8.80% (RHP p.450). The loans are secured on the company's assets and fixed deposits, with personal guarantees from the promoters (RHP p.450).

Contingent liabilities at June 30, 2026 were bank guarantees of ₹78.9 crore and disputed GST of ₹0.83 crore; a customs notice received on July 23, 2026 is treated as a contingent liability without an amount (RHP p.97). Other contractual commitments were ₹90.6 crore (RHP p.97).

Source: RHP p.92.

08What the money is for

Tonbo Imaging India IPO objects: what the money is for

Source: RHP p.89, RHP p.139; the amount at the upper band is our arithmetic.

The stated objects are the benefits of listing and the sale of shares by the selling shareholders (RHP p.139). The company says listing will add to its visibility and give its shareholders liquidity (RHP p.139). Offer expenses, other than listing fees and the company's own advertising, are shared among the sellers (RHP p.139).

Into the business nothing: there is no fresh issue (RHP p.89). To selling shareholders about ₹852.2 crore at the upper band, the offer for sale of 12,174,046 shares (our arithmetic, RHP p.89).

09Who is selling

Tonbo Imaging India IPO offer for sale: who is selling

Source: RHP p.3, RHP p.120, RHP p.121; percentages our arithmetic.

The other sellers are Timothy Guy Mitchell (208,700 shares), Artiman Partners LLC (197,350), Amit Dilip Shah (84,600, for the Amit Shah Family Trust), Ramesh Radhakrishnan (80,000), Artiman Ventures Select 2014 L.P. (69,400), Artiman Ventures Select 2014 Principals Fund L.P. (1,100) and Tiruvidaimarudhur Srivatsan Sivashankar and Meera Sivashankar (80,000) (RHP p.3).

Weighted average cost per share: nil for Arvind Kondangi Lakshmikumar and CEAQ Technologies Private Limited, whose remaining shares came from the bonus issue; ₹0.27 for CEAQ Technologies Pte. Ltd.; ₹33.91 for Ankit Kumar and Cecilia D’Souza; ₹197.06 for Vinimaya Advisory LLP (RHP p.130). The offer is 21.3% of the shares in issue (our arithmetic, RHP p.89).

10Promoters

The promoters are Ankit Kumar, Arvind Kondangi Lakshmikumar and Cecilia D’Souza (RHP p.3). Arvind Kondangi Lakshmikumar is Managing Director and Chief Executive Officer, Ankit Kumar is Executive Director and Chief Business and Revenue Officer, and Cecilia D’Souza is Executive Director and Chief Commercial Officer (RHP p.101). The prospectus credits each with over 21 years of experience, in capital raising and sales, in R&D, and in finance respectively (RHP p.256, RHP p.257). None of their shares is pledged (RHP p.119).

What the company pays them (RHP p.100):

• FY24: ₹0.12 crore in all, to Cecilia D’Souza.
• FY26: Arvind Kondangi Lakshmikumar ₹1.00 crore, Cecilia D’Souza ₹1.39 crore, Ankit Kumar ₹2.81 crore.
• Together ₹0.12 cr → ₹5.2 cr from FY24 to FY26 (RHP p.100).

The corporate office in Koramangala is leased from Arvind Kondangi Lakshmikumar, under a lease valid to August 31, 2027 (RHP p.311), at ₹0.21 crore in FY26 (RHP p.100). The promoters have given personal guarantees for the company's bank loans (RHP p.450).

Promoter economics: Arvind Kondangi Lakshmikumar received 85,000 shares of ₹10 as a gift from Timothy Guy Mitchell in January 2014, and on March 31, 2024 transferred 19,541 and 19,775 shares to Ankit Kumar and Cecilia D’Souza at about ₹3,391 a share; Ankit Kumar also acquired 10,826 shares from Timothy Guy Mitchell at the same price (RHP p.119, RHP p.120). A 19-for-1 bonus in June 2025 and a split from ₹10 to ₹2 in September 2025 followed (RHP p.115, RHP p.116).

11Who already owns it

Tonbo Imaging India promoter holding before and after the IPO

Source: RHP p.120, RHP p.131, RHP p.132. Other holders of 1% or more are the Serial Innovations Employee Stock Option Trust with 3.33%, SSV Advisory Services LLP with 1.42%, Vinimaya Advisory LLP with 1.15%, Meghaa Karnani (for Palita Associates) with 1.13%, Tenacity Ventures Fund - I with 1.12% and Tiruvidaimarudhur Srivatsan Sivashankar and Meera Sivashankar with 1.05% (RHP p.132).

The share count is 57,282,100 before and after the offer (RHP p.89). Promoter holding goes 17.4% → 14.0%, as the promoters offer 1,960,000 shares (our arithmetic, RHP p.120). Because the promoters will hold less than 20%, CEAQ Technologies Pte. Ltd. will lock in shares to make up the minimum promoters' contribution, without becoming a promoter (RHP p.124, RHP p.125).

When the large holders came in (RHP p.114, RHP p.115, RHP p.122, RHP p.123):

• HBL Engineering Limited, the CEAQ companies and others received shares on conversion of preference shares in March 2025.
• Florintree Flowtech LLP, Yali Deeptech Fund I, Tenacity Ventures Fund - I, Export-Import Bank of India and others subscribed in a private placement on March 27, 2025 at ₹25,000 a ₹10 share, which is ₹250 a share after the bonus and split (our arithmetic, RHP p.114).
• On September 29 and 30, 2026, CEAQ Technologies Private Limited sold 5,166,400 shares and CEAQ Technologies Pte. Ltd. 744,800 shares at ₹700 a share, to buyers including Amansa Investments Ltd., SBI Emergent India Fund, SBI Optimal Equity Fund, HDFC Life Insurance Company Limited, 360 ONE Multi-Stage Defence and Space Fund, Susquehanna Asia Technology Pty Limited and Malabar India Fund Limited (RHP p.122, RHP p.123).

Employee options in force were 1,735,400, at an exercise price of ₹2 (RHP p.134, RHP p.135); the Serial Innovations Employee Stock Option Trust holds 1,904,700 shares (RHP p.131).

12What changed just before the IPO

• The company bought its intellectual property from CEAQ Technologies Pte. Ltd. for ₹183.2 crore under agreements of March 11, 2024, paid over FY24 to FY26, and stopped paying royalties (RHP p.277, RHP p.441, RHP p.440).
• Private placement at ₹25,000 a ₹10 share in March 2025, and conversion of preference shares the same day (RHP p.114).
• The employee trust's shares were bought back in March 2023 and June 2025 (RHP p.113, RHP p.115).
• Bonus issue of 19 shares for each one held, June 30, 2025 (RHP p.115); this was the last allotment of shares in the capital history (RHP p.116).
• Split of each ₹10 share into five ₹2 shares, September 16, 2025 (RHP p.116).
• The company became a public company with a certificate dated September 11, 2025 (RHP p.3).
• Subsidiaries Tonbo Systems Pty Ltd and Tonbo LLC were incorporated in July and September 2024 (RHP p.250).
• Three independent directors were appointed on September 29, 2025 (RHP p.312).
• The auditor did not change: there has been no change in the statutory auditors in the last three years (RHP p.105).
• A first draft prospectus was filed on December 22, 2025 (RHP p.7), followed by complaints to SEBI and others in March 2026, which the company denied (RHP p.43).
• Revenue went ₹428.2 cr → ₹362.6 cr and profit after tax ₹68.5 cr → ₹50.9 cr from FY24 to FY26 (RHP p.94); receivable days went 57 → 212 (RHP p.404).
• Promoter remuneration went ₹0.12 cr → ₹5.2 cr from FY24 to FY26 (RHP p.100).
• The CEAQ companies sold 5,911,200 shares at ₹700 in September 2026 (RHP p.122, RHP p.123).

13Capacity and expansion

Source: RHP p.281, RHP p.256, RHP p.280, RHP p.276.

Pilot units are made at the R&D centre in Bengaluru, which holds a factory licence valid to December 31, 2027 and two industrial licences for military optical and imaging equipment (RHP p.458). Volume production is with Kaynes Technology India Limited and Avalon Technology and Services Private Limited under non-exclusive agreements; they give 12 to 24 months' warranty on defects (RHP p.276). R&D cost was ₹25.9 crore in FY26, 8.62% of total expenses (RHP p.41).

The company is developing directed energy systems, which have not yet produced revenue (RHP p.253). No money from the issue goes to the company to fund them (RHP p.139). The prospectus does not disclose installed capacity, units made or utilisation at the contract manufacturers.

14Market size and industry structure

Tonbo Imaging India industry: market size and growth

The industry chapter draws on "Assessment of Global and Indian Defence Electronics and Technology Industry", dated October 2026, by Frost and Sullivan (India) Private Limited, commissioned and paid for by the company (RHP p.250).

As claimed: the commissioned report puts the global defence electronics market at USD 60.7 billion in CY2020 and projects USD 232.1 billion by CY2030, a 14.4% CAGR (RHP p.199). For India it gives USD 3.2 billion in CY2020 and projects USD 17.6 billion by CY2030, an 18.6% CAGR, which the report calls the fastest globally (RHP p.200).

The part that is addressable: electro-optical and infrared systems, the company's field. The report puts the global market at USD 6.4 billion in CY2020 and projects USD 14.4 billion in CY2030, an 8.4% CAGR (RHP p.209). India's share of it was USD 522 million in CY2020, and the report projects USD 1.4 billion by CY2030, a 10.5% CAGR (RHP p.210). Europe was USD 1.2 billion in CY2020 (RHP p.210).

What the company is today: FY26 revenue of ₹362.6 crore (RHP p.94). The report says the company was the largest supplier, by sales value, of thermal imaging systems to Indian government and defence agencies from April 2024 to March 2026 (RHP p.239), and had 94% of India's thermal imaging exports by units between FY24 and FY26 (RHP p.251).

Size over time: the report puts India's defence spending at USD 58.9 billion in FY2015 and USD 92.05 billion in FY2025, a 4.6% CAGR (RHP p.185), and projects USD 113.6 billion by FY2030 (RHP p.186). It cites a FY2025-26 allocation of ₹6,81,210.27 crore, with ₹1,92,388 crore for capital outlay (RHP p.186), and a FY2026-27 allocation of ₹7,85,000 crore, up 15.2% (RHP p.187).

Segments: the report splits electro-optical and infrared demand into air, land, naval, tactical and homeland security uses (RHP p.211). The tactical segment, which covers soldier-carried sights and hand-held devices, the company's largest product line, was USD 2.62 billion in CY2020 and the report projects USD 4.30 billion by CY2030, a 5.1% CAGR (RHP p.213). It also sizes precision guided weapons and directed energy systems, where the company is developing products (RHP p.221, RHP p.253).

What drives demand: the report names modernisation of armed forces, electronic warfare and sensor fusion, high defence budgets in the US, China, India and Europe, and new threats such as drones and hybrid warfare (RHP p.199, RHP p.200). For India it names indigenisation under Make in India and the Defence Acquisition Procedure 2020, drone-based surveillance, thermal imagers and border monitoring (RHP p.210), and emergency purchases after Operation Sindoor in 2025 (RHP p.186).

Structure: the report says the market is dominated by large manufacturers, with high entry barriers from research cost, long qualification and defence certification (RHP p.220). It profiles as competitors Bharat Electronics, Data Patterns, Paras Defence and Space Technologies, Astra Microwave Products, Zen Technologies, Tata Advanced Systems and VEM Technologies in India, and Teledyne, Hensoldt, Theon and Controp abroad (RHP p.240, RHP p.241, RHP p.242).

Inputs and trade: infrared components such as detectors, displays and optics come from a few suppliers in Europe, South East Asia and China (RHP p.30). Germanium, used in infrared lenses, is scarce and mined in few countries such as China and Russia, with export restrictions (RHP p.220). The report notes that India still imports core detector and camera technology (RHP p.220).

Rules: the company needs industrial licences under the Industries (Development and Regulation) Act for military equipment (RHP p.458) and SCOMET export authorisations (RHP p.33). To supply as an Indigenously-Designed, Developed and Manufactured vendor, at least half of the cost must originate in India (RHP p.252). European procurement under the SAFE and EDIP rules requires at least 65% of component cost from the EU and partner countries (RHP p.33).

What the chapter says can go wrong: cuts or delays in defence budgets, adversaries' countermeasures, supply chain dependence on a few countries and export controls, and the cost of building ruggedised equipment (RHP p.219, RHP p.220). For India it adds slow procurement cycles, gaps in carrying out Make in India policies and the capital needed for detector research (RHP p.220). The risk factors add that emergency purchases come in spikes that may not last (RHP p.27).

15Competitive position

Tonbo Imaging India competitors

Source: RHP p.240, RHP p.241, RHP p.242. Figures for the listed Indian peers are in section 15.

Why customers choose this company, as the prospectus puts it: its own intellectual property, products designed in India and free of US ITAR restrictions, field use in 24 countries, and products benchmarked to developed markets but priced for developing ones (RHP p.251, RHP p.239). Its bid-to-win ratio was 40.91% in FY24, 35.94% in FY25 and 34.35% in FY26 (RHP p.28). The prospectus says defence rules in many countries favour domestic makers (RHP p.32).

16Peers the company named

Peers named in the offer document: Paras Defence and Space Technologies, Data Patterns (India), Astra Microwave Products, Zen Technologies and Bharat Electronics (RHP p.146).

Tonbo Imaging India listed peers

Source: RHP p.146; peer P/E at BSE closing prices of October 7, 2026, converted from ₹ million; Data Patterns is standalone. The prospectus gives the peers' average P/E as 81.62, between 45.70 and 117.74 (RHP p.144, RHP p.145). Bharat Electronics' revenue is about 76 times the company's; the other four are between about 1.3 and 3.2 times (our arithmetic, RHP p.146). In FY26 the company's EBITDA margin of 28.85% compares with 26.00% for Paras Defence, 40.12% for Data Patterns, 28.70% for Astra Microwave and 48.37% for Zen Technologies, as the industry report tabulates (RHP p.248).

17Valuation at the issue price

Tonbo Imaging India IPO valuation and P/E

At the upper band of ₹700, on the 57,282,100 shares in issue before and after the offer (our arithmetic, RHP p.89):

Source: RHP p.89, RHP p.94, RHP p.144, RHP p.145; our arithmetic. On basic EPS of ₹9.19 the P/E is 76.2 times (our arithmetic, RHP p.144). Enterprise value adds March 2026 borrowings of ₹116.1 crore and takes off cash and bank balances of ₹38.6 crore (our arithmetic, RHP p.92). At the lower band of ₹665 the market capitalisation is ₹3,809.3 crore (our arithmetic, RHP p.89). Against June 2026 NAV per share of ₹94.01 the price is 7.4 times (our arithmetic, RHP p.145).

The five peers the prospectus names traded at 45.70 to 117.74 times earnings on October 7, 2026, with a median of 83.9 times (our arithmetic, RHP p.146). At the upper band the issue is priced at 78.8 times FY26 profit, about 6% below that median. The CEAQ companies sold shares at ₹700, the upper band, less than two weeks before the date of the prospectus (RHP p.122, RHP p.123).

18Risks, in plain words

Tonbo Imaging India IPO risks

Customers: one customer was 57.07% of FY25 revenue and the top five 53.03% of FY26 revenue (RHP p.29) → orders are won tender by tender with little repeat business (RHP p.29) → revenue fell 22.69% in FY26 when the export order was not replaced (RHP p.149).

Suppliers and a related party: the three largest suppliers were 55.72% of FY26 total expenses (RHP p.30), and CEAQ Singapore, a 25.47% shareholder, supplied ₹79.0 crore of materials in FY26 (RHP p.99, RHP p.132) → a break in supply stops deliveries → critical components from international suppliers were 54.67% of FY26 cost of goods sold (RHP p.31).

Working capital and cash: working capital days were 517 in FY26 (RHP p.149) → the business needs bank lines to fund stock and receivables → operating cash flow was negative in FY25, FY26 and the three months to June 2026 (RHP p.40).

Recent results: a loss of ₹17.7 crore in the three months to June 2026 (RHP p.94) → the company says revenue falls in the first half of the year (RHP p.149) → FY26 profit included a warranty write-back of ₹18.8 crore (RHP p.438).

Delivery and quality: late deliveries led to liquidated damages of ₹21.8 crore in FY24 and ₹18.9 crore in FY25 (RHP p.31) → performance bank guarantees stood at ₹78.9 crore at June 2026 (RHP p.97).

Complaints: after the first draft prospectus, anonymous and named complaints to SEBI, the exchanges and the Ministry of Defence alleged, among other things, component imports from Chinese makers through CEAQ Singapore and pricing below cost; the company denied all of them (RHP p.43, RHP p.44, RHP p.45, RHP p.46).

Legal: a minority shareholder of CEAQ Singapore has sued in the Singapore High Court, naming the company, Arvind Kondangi Lakshmikumar and Amit Dilip Shah (RHP p.453) → see section 23.

Regulation: the company needs defence licences and export authorisations, and must meet indigenous content rules to bid under IDDM (RHP p.33, RHP p.252). It has delayed some regulatory filings with the Registrar of Companies in the past (RHP p.51).

Issue-specific: the company receives nothing from the offer (RHP p.60). After the offer the promoters hold about 14.0% (our arithmetic, RHP p.120).

19Litigation and regulatory matters

Cases against Tonbo Imaging India and its promoters

The prospectus records no criminal proceedings and no regulatory actions against the company, its subsidiaries or its promoters, and no SEBI or exchange action against the promoters in five years (RHP p.452, RHP p.453, RHP p.454, RHP p.455). Four material creditors were owed ₹32.6 crore at June 30, 2026, with nothing overdue (RHP p.457).

20Related-party transactions

Source: RHP p.99, RHP p.100, converted from ₹ million. Lease rent to Arvind Kondangi Lakshmikumar was ₹0.18 crore, ₹0.21 crore and ₹0.21 crore (RHP p.100). UAB Tonbo Imaging, Lithuania, supplied ₹15.3 crore of materials in FY24 (RHP p.99).

What appeared or changed in the two years before filing: royalty payments to CEAQ Singapore stopped after the intellectual property purchase of March 2024 (RHP p.40); dealings with HBL Engineering Limited ended after FY24 (RHP p.99); promoter salaries began in FY25 and FY26 (RHP p.100); the registered office has been sub-leased to CEAQ India from January 1, 2026 (RHP p.68). The company says its related-party transactions were at arm's length (RHP p.40).

21What the offer document does not say

Customer names are not disclosed, other than that the largest customer in FY24 and FY25 was in Armenia. Units sold, prices per unit and margins by product are not given, so growth cannot be split into volume and price. The capacity and use of the contract manufacturers are not disclosed. How the ₹183.2 crore price for the intellectual property bought from CEAQ Singapore was set is not explained in the pages read.

Who owns CEAQ Technologies Pte. Ltd. and what else it does are not set out in the pages read. The customs notice of July 2026 carries no amount. The price band, lot, offer expenses and post-offer holdings are blank in the prospectus (RHP p.3, RHP p.120).

22Five questions for management

1. How many units did the company ship in each of FY24, FY25 and FY26, and at what average price for tactical and platform systems?
2. What share of the June 2026 inventory of ₹319.6 crore is tied to orders already in the order book, and when will it be delivered?
3. On what terms and prices does CEAQ Singapore supply materials, and how do they compare with buying directly from the component makers?
4. What warranty claims arose in FY24 to FY26, and what made the ₹18.8 crore write-back in FY26 possible?
5. How much of the ₹314.2 crore order book at June 2026 is due for delivery in FY27, and from how many customers?

24Draft to final: what changed

FY24 to FY26 revenue and profit, the absence of a fresh issue and the lead managers are the same in both documents (DRHP p.88, RHP p.94, DRHP p.2, RHP p.2).

1Sources and cited facts

This study was read from 1 document the company filed. The 199 figures it cites are listed under the document each came from, with the page and the sentence as printed.