New Delhi, July 7, 2025: Shakti Pumps (India) Ltd has successfully raised Rs 292 crore through a Qualified Institutional Placement (QIP), marking a significant milestone in its growth journey. The fund infusion will primarily be utilised to bolster the company’s manufacturing capacity, invest in clean energy solutions, and pare debt.
Details of the QIP
The company’s Board of Directors approved the issuance of equity shares aggregating to Rs 292 crore to qualified institutional buyers at a floor price determined in accordance with SEBI guidelines. The issue opened on July 3 and closed on July 5, attracting robust participation from domestic mutual funds, insurance firms, and foreign institutional investors.
The shares were allotted at a price of Rs 1,432 per equity share, representing a slight discount to the previous closing price, making it an attractive opportunity for institutions eyeing India’s growing water pump and solar pump markets.
Use of proceeds
In its filing to the exchanges, Shakti Pumps stated that proceeds from the QIP will be strategically channelled towards:
✅ Capacity expansion: Enhancing manufacturing capabilities to meet rising demand, especially in the solar pump segment
✅ Research and development: Developing energy-efficient pumps, IoT-integrated smart pumping systems, and clean energy-based solutions
✅ Debt reduction: Strengthening the balance sheet to improve credit metrics and reduce interest outgo
✅ Working capital needs: Funding inventory build-up to cater to export orders and upcoming government projects
Management commentary
Dinesh Patidar, Chairman and Managing Director of Shakti Pumps, said:
“The successful completion of our QIP reflects strong investor confidence in our business model and growth plans. This capital will help us drive technological innovation in solar and clean energy pumps, expand globally, and improve operational efficiency.”
Financial snapshot
| Particulars (Standalone) | FY23 | FY24 |
|---|---|---|
| Revenue | Rs 1,237 crore | Rs 1,512 crore |
| EBITDA | Rs 143 crore | Rs 178 crore |
| PAT | Rs 77 crore | Rs 92 crore |
| Net Debt | Rs 308 crore | Rs 196 crore |
| Net Debt/Equity | 0.68x | 0.42x |
The QIP proceeds are expected to further reduce the net debt to equity ratio below 0.25x, enhancing financial flexibility.
Growth drivers for Shakti Pumps
- Solar pump market leadership: Shakti Pumps is a major beneficiary of the Government of India’s PM-KUSUM scheme, targeting installation of 3.5 million solar pumps by 2026 to boost irrigation in rural India.
- Export expansion: The company has a growing presence in Africa, Southeast Asia, and Latin America, exporting energy-efficient stainless steel pumps and solar pumping systems to over 100 countries.
- Clean energy shift: With an emphasis on decarbonisation, the demand for solar water pumping solutions is rising across the agricultural and industrial sectors, creating significant opportunities.
- IoT integration: Shakti is investing in smart pump controllers and remote monitoring systems to build recurring revenue streams through integrated solutions.
Industry context: Indian pump market
India’s water pump market is projected to grow at 8-10% CAGR between FY25 and FY30, driven by:
✅ Rising irrigation needs amid erratic monsoons
✅ Government push for solarisation of pumps to reduce diesel subsidy burden
✅ Industrial capex recovery fuelling demand for process and utility pumps
| Top players by market share (FY24) |
|---|
| Kirloskar Brothers – 22% |
| Shakti Pumps – 15% |
| Crompton Greaves Consumer – 12% |
| KSB Pumps – 10% |
| Others – 41% |
QIP route: benefits and compliance
Under SEBI’s Qualified Institutional Placement regulations, listed companies can raise funds swiftly without elaborate regulatory approvals required for public issues. The key benefits include:
✅ Faster execution and capital infusion
✅ No dilution of promoter stake below regulatory minimum
✅ Flexibility in pricing based on institutional demand
Shakti Pumps’ QIP was managed by leading investment banks, and the issue was oversubscribed, reflecting institutional confidence in its growth trajectory.
Analyst views
✅ ICICI Securities: “The QIP will significantly deleverage Shakti Pumps’ balance sheet, enabling higher investments in solar pump and international business expansion.”
✅ Motilal Oswal: “Maintain BUY with a target price of Rs 1,710. QIP proceeds will catalyse growth while ensuring stronger capital structure.”
✅ HDFC Securities: “Positive. Clean energy pumps remain a structural growth theme. Watch for execution on export orders and new product launches.”
Market reaction
Post QIP announcement, Shakti Pumps’ shares closed 3.2% higher at Rs 1,489 on NSE on Monday, signalling positive investor sentiment towards the fundraise and business outlook.
Future plans
The company is expected to utilise the funds in phases over the next 12-18 months, focusing on:
- Setting up new manufacturing lines for solar pumps and EV motors
- Developing battery-integrated solar solutions for off-grid irrigation
- Exploring joint ventures to expand presence in Africa and Southeast Asia
Conclusion
With the successful completion of its Rs 292 crore QIP, Shakti Pumps is well positioned to accelerate its clean energy solutions, drive export growth, and achieve financial resilience. The strategic focus on solarisation and smart pumping technology aligns with India’s energy transition goals and global sustainability trends, strengthening its long-term growth prospects.
Disclaimer: This article is for informational purposes only. Investments in equities and IPOs are subject to market risks. Readers are advised to consult certified financial advisors before making investment decisions.
