Zelio E-Mobility
- Zelio E-Mobility is coming out with an initial public offering (IPO) of 57,60,000 equity shares in a price band of Rs 129-136 per equity share.
- The issue will open on September 30, 2025 and will close on October 3, 2025.
- The shares will be listed on SME Platform of BSE.
- The face value of the share is Rs 10 and is priced 12.90 times of its face value on the lower side and 13.60 times on the higher side.
- Book running lead manager to the issue is Hem Securities.
- Compliance Officer for the issue is Priyanka Garg.
Profile of the company
The company is primarily engaged in the business of manufacturing, assembling and supplying of electric vehicles, offering a range of electric two-wheelers (E-2Ws) and three-wheelers (3Ws), available in a variety of design, color, speed variants etc. It is an ISO 45001:2018, ISO 9001:2015 and ISO 14001:2015 certified company, operating under the brand name ‘Zelio’ for E-2Ws and ‘Tanga’ for 3Ws and focussing exclusively on the production of E-2Ws and 3Ws which serves environmental benefits such as lower emissions, reduced noise, energy sustainability etc. It launched the first range of electric scooters in FY 2021-22 and operate through a network of exclusive and non-exclusive dealers spanning across urban, semi-urban, and rural areas.
Currently, it is operating its business through corporate office and manufacturing unit situated at Haryana, India. It has an installed capacity of producing 72000 units p.a. (electric two-wheelers/three-wheelers) and are equipped with various machines such as Conveyor Line-32 meter long, welding machines, impact wrenches, bolt tightening tools, drilling tools etc. for manufacturing, assembling and supplying of electric vehicles. It manufactures EVs by assembling various parts which it outsources from suppliers as per the designs conceptualised by the company. The company is registered under the Bureau of Indian Standards and SAE International and also USA has confirmed World Manufacturer identifier (WMI) code for the company.
It operates its business through a wide network of dealers, and at present, its focus is primarily on B2B transactions. It is working with 337 dealers spreading across more than 20 states & union territories in India, thus, selling its products pan-India. Its E-2Ws portfolio comprises of various models inclusive of EEVA, EEVAZX, Gracy, Legender, Mystery, XMen etc. and E-3Ws comprises of vehicles namely, Tanga and Tanga e-Loader under the Brand name of ‘Tanga’.
Proceed is being used for:
- Repayment and/or pre-payment, in full or part, of borrowing availed by the company
- Funding the Capital Expenditure requirements towards setting up of a new manufacturing unit
- Meeting working capital requirement
- General corporate purpose
Industry Overview
India's Electric Vehicle (EV) sector is experiencing rapid growth, fuelled by government incentives, rising environmental concerns, and technological advancements. With initiatives like the Faster Adoption and Manufacturing of Hybrid and Electric Vehicles (FAME) scheme, India aims to significantly increase EV adoption, revolutionizing its transportation landscape towards sustainability and innovation.
India has established an objective to elevate the proportion of Electric Vehicle (EV) sales to 30% in private cars, 70% in commercial vehicles, 40% in buses, and 80% in two-wheelers and three-wheelers by the year 2030. This equates to an ambitious objective of 80 million EVs on Indian roads by 2030. Additionally, India strives for complete domestic EV production through the 'Make in India' initiative. India's electric vehicle market is anticipated to expand at a CAGR of 28.52% to attain $18.319 billion by 2029 from $5.22 billion in 2024. The automobile sector received a cumulative equity FDI inflow of about Rs 2,48,682.50 crore ($29.07 billion) between April 2000- March 2025.
The Government has reaffirmed its commitment towards EVs and its mission for 30% electric mobility by 2030. Budget announced customs duty exemption on the import of capital goods and machinery required for the manufacture of lithium-ion batteries that typically power EVs. FAME II for EV Scheme was Commenced on April 01, 2019 with a total budgetary support of $1.43 billion (Rs 10,000 crore), 30% procurement of manufactured or processed products must be from SMEs. This phase primarily targets the electrification of public and shared transportation. A subsidy of Rs 5,790 crore ($693 million) has been granted to electric vehicle manufacturers for the sale of 1,341,459 electric vehicles under phase II of the FAME India Scheme. It aims to provide demand incentives for 7,090 e-buses, 5 lakh e-3 Wheelers, 55,000 e-4 Wheeler Passenger Cars, and 10 lakh e-2 Wheelers.
Pros and strengths
Extensive network of dealers covering major parts of India: It sells its products through a network of dealers consisting of exclusive and non-exclusive dealers spread across various states and union territories in India. It works with various dealers depending on their geographical reach, market knowledge, product and customer awareness as well as understanding of electric vehicle industry. Its sales & distribution network is aided by its capable in-house sales and marketing team, which liaise with the dealers on a regular basis for customer inputs, market Zelio products as well as positioning of its products vis-a-vis products of its competitors. Maintaining strong relationships with its dealers are essential to its business strategy and to the growth of its business. It continually strives to maintain strong relationships with its dealers in order to have uninterrupted supplies of its products to them and retain them for a long period of time.
Quality assurance ensuring standardized product quality: Quality is an ongoing process of building and sustaining long term relationships with customers and long-term brand loyalty. This philosophy has formed the foundation of the expansion and diversification of its product portfolio since its inception. It has obtained ISO 9001:2015 certification for Quality Management System, ISO 14001:2015 certification for Environment Management System and ISO 45001:2018 certification for Occupational Health and Safety Management System from QFS Management Systems LLP. These certifications assist it in providing assurance to its customers for the quality and durability of its products. It is engaged in the business of manufacturing, assembling and supply of electric vehicles namely electric 2-Ws and 3Ws and have successfully ventured and supplied quality products to its customers.
Proven track record of financial success: The company’s focus on efficient operations and effective business practices has consistently delivered effective financial results. Throughout this period, it has maintained healthy cash flow while improving its profitability. The company’s revenue from operations increased to Rs 17218.94 lakh in FY25 as compared to Rs 9442.50 lakh in FY24 and Rs 5125.10 lakh in FY23. The company’s profit after tax increased to Rs 1600.85 lakh in FY25 as compared to Rs 630.88 lakh in FY24 and Rs 305.53 lakh in FY23. Further, its PAT Margin surged 9.30% in FY25 from 6.68% in FY24 and 5.96% in FY23.
Risks and concerns
Dependent on limited number of suppliers: The company is dependent on limited number of suppliers within limited geographical location for procurement of raw materials. During the Fiscal 2025, 2024 and 2023, its cost of goods sold (cost of materials consumed, direct expenses and changes in inventories of finished goods) was Rs 13,699.29 lakh, Rs 7,923.86 lakh and Rs 4,372.19 lakh respectively, which represented 79.56%, 83.92% and 85.31% of its revenue from operations respectively, for the said period. Any delay, interruption or reduction in the supply of raw materials required for its products may adversely affect its business, results of operations, cash flows and financial condition.
Geographical constraints: It generates its major portion of turnover from its operations in certain geographical regions. For the financial year ended March 31, 2025, March 31, 2024 & March 31, 2023, it derived notable portion of its revenue from the state of Haryana i.e. 26.34%, 41.41% and 55.15% of total revenue from operations, respectively and it derived 61.87%, 81.19% and 90.26% of total revenue from operations from top-5 states, respectively, for the financial year ended March 31, 2025, March 31, 2024 & March 31, 2023. Any adverse developments affecting its operations in these regions could have an adverse impact on its revenue and results of operations.
Dependent on sale of products to key dealers: Its business is dependent on the sale of its products to certain key dealers. During the Fiscal 2025, 2024 and 2023 revenue generated from its top 10 dealers were Rs 5,072.97 lakh, Rs 3,685.07 lakh and Rs 2,589.73 lakh which represented 29.46%, 39.03% and 50.53%, respectively of its revenues from operations for the said periods. It has not entered into long term agreements with these dealers and the success of its business is significantly dependent on maintaining good relationship with them. The loss of a significant dealer or dealers could have a material adverse effect on its results of operations.
Outlook
The company is primarily engaged in the business of manufacturing and assembling of Electric Automobiles viz. Electric Scooter and Electric Rickshaw. It is an ISO 45001:2018, ISO 9001:2015 and ISO 14001:2015 certified company, operating under the brand name ‘Zelio’ for E-2Ws and ‘Tanga’ for 3Ws and focussing exclusively on the production of E-2Ws and 3Ws which serves environmental benefits such as lower emissions, reduced noise, energy sustainability etc. On the concern side, it sources its majority of the raw materials from international market i.e. China. Any adverse developments affecting its procurement in this region could have an adverse impact on its revenue and results of operations. Further, its business is working capital intensive and hence, inventories and trade receivables form a major part of its current assets. Failure to manage its inventory and trade receivables could have an adverse effect on its sales, profitability, cash flow and liquidity.
The issue has been offering 57,60,000 shares in a price band of Rs 129-136 per equity share. The aggregate size of the offer is around Rs 74.30 crore to Rs 78.34 crore based on lower and upper price band respectively. On performance front, during the financial year 2024-25, the revenue from operation of the company increased to Rs 17,218.94 lakh as against Rs 9,442.50 lakh in the Financial Year 2023-24 representing an increase of 82.36%. The company reported restated profit after tax for the financial year 2024-25 of Rs 1600.85 lakh in comparison to Rs 630.88 lakh in the financial year 2023-24.
The company intends to focus on adhering to the quality standards of the products. Quality of the product is very important for the company from both customer point of view and market point of view. Continuous quality review of products and timely corrective measures in case of quality diversion are keys for maintaining quality standards of the products. It has been implementing measures to reduce the wastages and defectives over the period which are being produced in the production process. Providing the desired and good quality products help it in enhancing customer trust and maintaining long term relationships with customers along with brand loyalty.
