Rakshan public-utility revenue share fell to 51% of FY26 sales

Rakshan Transformers Limited derived 50.73% of revenue from operations from government and public-utility customers in Fiscal 2026, down from 72.99% in Fiscal 2025. The decline reflected both a fall in business-to-government revenue to Rs 181.41 crore and a rise in business-to-business revenue to Rs 178.74 crore.

Why did Rakshan public-utility revenue share fall to 51% in FY26?

Rakshan public-utility revenue share fell by 22.26 percentage points in Fiscal 2026 because business-to-government, or B2G, sales declined while business-to-business, or B2B, sales increased. B2G revenue, covering government customers including public utilities, was Rs 181.41 crore in Fiscal 2026, compared with Rs 236.63 crore in Fiscal 2025. Total revenue from operations nevertheless rose to Rs 363.11 crore from Rs 324.21 crore over the same period.

B2B revenue increased to Rs 178.74 crore in Fiscal 2026 from Rs 87.58 crore in Fiscal 2025, lifting its share of revenue from operations to 49.22% from 27.01%. Business-to-consumer, or B2C, sales were Rs 17.83 lakh, or 0.05% of Fiscal 2026 revenue, leaving the customer mix almost entirely split between B2G and B2B sales.

Rakshan’s government and public-utility exposure has changed across the three reported fiscal years rather than following a consistent downward trend. B2G represented 56.13% of revenue from operations in Fiscal 2024, increased to 72.99% in Fiscal 2025, and then decreased to 50.73% in Fiscal 2026. The Fiscal 2026 mix will persist only if B2B sales remain at a comparable level and B2G orders do not regain a larger share of revenue.

How does Rakshan remain dependent on public-utility tenders?

Rakshan remains dependent on public-utility procurement because B2G customers supplied 50.73% of Fiscal 2026 revenue and the company secures many such supply contracts through competitive bidding. Tender awards are based on pricing, technical eligibility and compliance with stated qualification criteria. Rakshan says contracts are generally awarded to the lowest bidder, which can create pricing pressure even when the company qualifies for a tender.

Rakshan’s revenue depends on the timely receipt of purchase orders, so postponed tender awards, altered eligibility rules, project cancellations or re-floated tenders can delay order conversion. The company disclosed that Paschimanchal Vidyut Vitaran Nigam Limited, Meerut, barred it from bidding for three consecutive tenders under an order dated June 20, 2019. The disclosure illustrates that bidding eligibility can affect access to future public-sector orders.

Transformer demand is linked to investment in power generation, transmission and distribution infrastructure. Rakshan identifies electrification targets, rural and urban infrastructure programmes, budgetary allocations and renewable-energy integration as government-policy drivers of that investment. Continued public-utility revenue therefore requires projects to proceed, tenders to be issued and Rakshan to meet the applicable technical and financial requirements.

Can Rakshan’s order book convert into revenue and collections?

Rakshan reported an order book of about Rs 329.68 crore as of June 30, 2026, but the amount is not a guarantee of future revenue or cash collection. The order book is the estimated value of the unexecuted portion of confirmed orders for power and distribution transformers. Rakshan says it is not directly comparable with revenue from operations, which can include escalation, freight, insurance, commissioning charges and other ancillary income.

Conversion of the Rs 329.68 crore order book depends on delivery schedules, raw-material availability, production continuity, regulatory clearances, inspections and customer acceptance. Delays in dispatch, inspection or acceptance may defer invoicing. Rakshan states that payment schedules for public-sector utilities, State Electricity Boards and government agencies are often linked to delivery or inspection approvals, making customer-side clearances relevant to working-capital timing.

Confirmed orders can also be cancelled, reduced in quantity, renegotiated or affected by changes in customer priorities and procurement policies. A re-floated tender with revised technical or commercial terms may require Rakshan to requalify or submit a fresh bid. The order book will convert into reported revenue only if orders are executed, required approvals are obtained, invoices are raised and customers pay under contractual schedules.

What does the customer mix mean for Rakshan’s funding needs?

Rakshan’s exposure is concentrated not only in public utilities but also among its largest customers. The top 10 customers accounted for 71.49% of Fiscal 2026 revenue from operations, down from 82.82% in Fiscal 2025 and 83.52% in Fiscal 2024. The top three customers supplied 32.27% of Fiscal 2026 revenue, while the top five accounted for 46.36%.

Long credit periods and approval-linked payments can increase funds tied up in receivables, while transformer manufacturing requires expenditure on inputs before orders are completed and invoiced. Rakshan reported net working capital of Rs 44.68 crore at March 31, 2026, compared with Rs 24.72 crore at March 31, 2025 and Rs 89.77 crore at March 31, 2024. Net working capital is current assets excluding cash and cash equivalents and specified bank balances, less current liabilities excluding current borrowings.

Rakshan proposes to use Rs 35 crore from its initial public offering for working-capital requirements. The company says it expects to finance future requirements through cash generated from operations and working-capital loans. This approach depends on collections, borrowing availability and order execution because a funding shortfall could affect raw-material purchases, production and deliveries.

Conclusion

Rakshan’s Fiscal 2026 public-utility revenue share of 50.73% was lower than the 72.99% recorded in Fiscal 2025, principally because B2B revenue more than doubled to Rs 178.74 crore while B2G revenue declined to Rs 181.41 crore. The shift reduced the percentage of sales from government-controlled customers, but tender outcomes, policy-led infrastructure spending, inspection approvals and payment cycles remain material to revenue conversion and cash flow.

The next disclosed indicators are conversion of the Rs 329.68 crore order book, the timing of utility approvals and customer collections, and the proposed use of Rs 35 crore of initial public offering proceeds for working capital. Rakshan has stated that confirmed orders may not translate fully into financial results if delivery delays, input constraints, pricing changes, contract changes or customer-payment delays affect execution.