A Hyderabad-based defence and aerospace electronics systems manufacturer plans to raise Rs 66.51 crore via the BSE SME platform.
Merritronix Ltd., an electronics systems design and manufacturing company specialising in high-reliability, mission-critical products for defence, aerospace, and industrial electronics, opens for subscription on June 1 with the issue closing on June 3. The company is listing on the BSE SME platform.
What the Company Does
Incorporated in October 1988 and headquartered at the Electronic Complex, Kushaiguda, Hyderabad, Merritronix has over three decades of experience in defence and aerospace electronics. Its products are largely integrated electronic systems operated in B2B segment — covering embedded systems, power electronics, signal processing units, and mission-critical control systems. The company’s qualification processes in defence and aerospace sectors are typically lengthy, which supports long-term customer stickiness: its repeat customer rate stood at 86.08% in FY26, with 68 of 79 active customers representing repeat engagements.
Revenue is heavily concentrated — 97.81% from defence and aerospace, and 98.19% from Telangana — reflecting both the specialised and geographically anchored nature of the business.
Issue Details
| Particulars | Details |
|---|---|
| Issue Opens | June 1, 2026 |
| Issue Closes | June 3, 2026 |
| Listing | BSE SME (June 8, 2026) |
| Price Band | Rs 142 – Rs 149 per share |
| Face Value | Rs 10 |
| Issue Size | Rs 66.51 crore (100% Fresh Issue) |
| Lot Size | 800 shares (min 2 lots = 1,600 shares) |
| Min. Retail Investment | Rs 2,38,400 |
| BRLM | GYR Capital Advisors Pvt. Ltd. |
| Registrar | Bigshare Services Pvt. Ltd. |
Financial Performance
| Particulars (Rs cr) | FY24 | FY25 | FY26 |
|---|---|---|---|
| Revenue | 85.70 | 113.56 | 155.59 |
| PAT | 3.05 | 8.66 | 16.10 |
| PAT Margin | 3.56% | 7.63% | 10.35% |
| EBITDA Margin | ~7.5% | ~12.0% | 17.4% |
Revenue has grown at a 34.7% CAGR between FY24 and FY26, and PAT has expanded 5.3x over the same period from Rs 3.05 crore to Rs 16.10 crore. EBITDA margins have improved from sub-8% to 17.4%, reflecting an improving revenue mix toward higher-value turnkey defence programmes. However, a critical divergence exists: despite reporting PAT of Rs 16.10 crore in FY26, the company generated negative operating cash flows of Rs 23.38 crore in FY26 and negative Rs 6.64 crore in FY25. Listed peers in the defence electronics space trade at P/E multiples of 46.5x and 61.3x, against which the Merritronix issue appears relatively more modestly priced.
BRLM Track Record: This is the 36th mandate from GYR Capital in the last three fiscals. Of the last 11 listings, 2 listed at par and the rest with premiums ranging from 4.92% to 90% — a solid track record.
Risks to Consider
Negative operating cash flows despite growing profits represent a significant red flag — in defence electronics, long procurement cycles and milestone-based payments can cause substantial timing mismatches between revenue recognition and cash collection, but sustained negative operating cash flow needs close monitoring. Revenue and geographic concentration are structural risks: any adverse regulatory changes, delays in defence orders, or disruptions in Telangana-based operations could disproportionately impact the company.
Analyst View
Analysts note that the company has posted growth in its top and bottom lines for the reported periods, but that bumper profits from FY25 onwards raise eyebrows and concern over sustainability. The issue appears fully priced based on recent financial data, note analysts.