Victory Electric Vehicles ipo

Victory Electric Vehicles, established in October 2018 and public since February 2020, focuses on manufacturing electric two and three-wheelers for last-mile delivery, primarily in North India. They're eyeing an IPO from January 7-9, 2026, offering 8.43 million shares at ₹41 each to raise ₹34.56 crore, valuing the company at ₹100 crore post-IPO. The funds are earmarked for capital expenditure and working capital, with promoters retaining a significant 63% stake. However, a closer look reveals several concerns. The company's revenue has been stagnant at around ₹48-51 crore, with projected FY25 PAT at a modest ₹3 crore. Significant red flags include high related-party transactions, particularly for raw material purchases from a group firm. Worryingly, the "Victory" trademark and even the company's properties are personally owned/rented from promoters, pointing to potential conflicts of interest. Furthermore, previous IPOs handled by the lead managers have shown poor post-listing performance. With a P/E of around 134, the valuation appears steep given the flat sales and these governance issues. For investors, this looks like a risky proposition, suggesting it's best to avoid both short and long-term positions. Future Star Energy Solutions Pvt Ltd, a company within the promoters' group, has been a significant raw material supplier to Victory Electric Vehicles. The substantial inter-company transactions raise concerns about inflated revenues and potentially higher costs for Victory, highlighting opaque dealings within the family-controlled structure. In my opinion, the extensive related-party dealings, stagnant revenue, and high valuation of Victory Electric Vehicles signal substantial risks for potential investors. These factors, combined with promoter self-interest reflected in asset ownership, suggest caution. It's not a compelling investment.