Neolite ZKW Lightings IPO

Strengths · 8

• 01Revenue from operations rose from Rs 405.38 crore in FY2023 to Rs 512.08 crore in FY2025, and profit after tax rose from Rs 15.59 crore to Rs 52.82 crore.
• 02Cost of goods sold fell from 62.16% of revenue in FY2023 to 50.82% in FY2025, which lifted margins.
• 03Exports grew from 31.19% of revenue in FY2023 to 46.35% in FY2025, so the company is less tied to the Indian market.
• 04The top 10 customers have an average relationship of more than 11 years, and include VE Commercial Vehicles, JCB India, Daimler India Commercial Vehicles and Piaggio Vehicles.
• 05The range covers over 830 SKUs across passenger, commercial, off-road, three-wheeler and two-wheeler segments, and serves both electric and conventional vehicles.
• 06ZKW Group GmbH holds 26.00% before the issue and has a Cooperation Agreement with the company on product development and technology support.
• 07Net worth rose from Rs 110.69 crore at 31 March 2023 to Rs 181.91 crore at 31 March 2025, while total borrowing fell from Rs 112.79 crore to Rs 96.96 crore.
• 08The CRISIL report expects the domestic automotive lighting market to grow at 17-19% a year between Fiscal 2025 and 2030.

Risks · 10

• 01The top 10 customers gave 72.11% of revenue in FY2025 and 82.50% in the three months to 30 June 2025. The largest customer alone gave 20.60% in FY2025 and 30.79% in that quarter.
• 02OEM customers gave 87.41% of revenue in FY2025, and the automotive sector gave 97.81%, so a slowdown in vehicle demand hits the company directly.
• 03CIS countries gave 91.89% of export revenue in FY2025, up from 39.07% in FY2023. Sanctions, trade limits or currency swings in those countries could hurt sales.
• 04Net cash from operations was Rs 45.77 crore in FY2025 against profit after tax of Rs 52.82 crore, as inventories and receivables grew.
• 05Unit 2 ran at 62.90% capacity utilisation in FY2025 and 26.72% in the half year to 30 September 2025.
• 06Of the Rs 152.51 crore planned for the Tamil Nadu plant, machinery of about Rs 45.30 crore is not yet contracted. The plans have not been appraised by a bank or financial institution.
• 07HSIIDC has demanded an enhanced plot cost of Rs 18.73 crore for the Unit 1 land. The matter is before the High Court, which has granted a stay.
• 08Related-party dealings are large. Design and tool development charges paid to Neokraft Global Private Limited were Rs 20.33 crore in FY2025, or 3.97% of revenue.
• 09Of the Rs 600.00 crore offer, Rs 200.00 crore is an offer for sale, so that money goes to the selling shareholders and not to the company.
• 10General corporate purposes are not yet fixed and may be up to 25% of the gross fresh issue proceeds.

Neolite ZKW Lightings Limited makes automotive lighting products and components for vehicle makers. It supplies passenger vehicles, commercial vehicles, off-road vehicles (agri and construction), three-wheelers and two-wheelers. It also sells to the aftermarket for replacement. The range covers over 830 SKUs as of 31 October 2025. The products suit both electric and petrol or diesel vehicles.

The company was incorporated in 1992 as Praplasin Industries Private Limited and became a public company in December 2025. Its promoters are Rajesh Jain, Vaishali Jain and Pramod Plastic Industries Private Limited. ZKW Group GmbH of Austria holds 26.00% before the issue. The two firms have a Cooperation Agreement for joint product development, marketing and, if needed, technology support. Earlier, a joint venture and a technology transfer agreement with ZKW were concluded in 2012.

Unit 1 at Bahadurgarh, Haryana makes lighting for OEMs and the aftermarket. Unit 2 is a sheet metal plant, also at Bahadurgarh. Unit 3 is an OEM lighting plant at Shinde village near Pune, Maharashtra, which began operations in 2025. There are two design centres, one inside Unit 1 and one in Pune. The company had an average of 590 permanent employees in the three months to 30 June 2025.

Sales are split between India and exports. Exports were 46.35% of revenue from operations in FY2025, up from 31.19% in FY2023. Most export revenue comes from CIS countries such as Russia and Uzbekistan. The top 10 customers have stayed with the company for more than 11 years on average. They include VE Commercial Vehicles, JCB India, Daimler India Commercial Vehicles and Piaggio Vehicles.

The company has taken a 99-year lease on 235,224 square feet of SIPCOT land at Sriperumbudur, Kancheepuram, Tamil Nadu. It plans a new plant there to serve OEM customers in southern India.

The industry

The company quotes a CRISIL report dated December 2025. It says the domestic automotive lighting industry was Rs 101.72 billion in Fiscal 2025 and may reach Rs 225 to 245 billion by Fiscal 2030, a CAGR of 17-19% in value terms. Lighting content per passenger vehicle and per commercial vehicle may each grow at 8-10% a year to about Rs 21,000 and Rs 7,000. The report names more LED use, costlier matrix headlights, ambient lighting and ADAS links as the drivers.

Customer concentration: Top 10 customers gave 72.11% of FY2025 revenue (68.07% in FY2024); the largest gave 20.60%.