Delta Investment Advisors

SEDEMAC Mechatronics Ltd

SEDEMAC Mechatronics manufactures control systems & controller units for mobility (2W / 3W + EV) and industrial generator markets. Its core products, including Integrated Starter Generator (ISG), Electronic Fuel Injection (EFI), and integrated controllers, are essential components for global Original Equipment Manufacturers (OEMs). It also manufactures Genset Control Units (GCU) and Electric Vehicle (EV) Motor Control Units (MCU). Its key customer TVS motor accounts for ~75% share of revenue (9M FY26).

DRHP filed: 10th November 2025

BRLM: ICICI Securities, Avendus Capital, Axis Capital

Auditor: B S R & Co. LLP

Disclaimer - Delta Partners (public market division under Dexter Capital) is not a SEBI registered Investment Advisor and this report does not constitute a recommendation but is only prepared for educational purposes. We (our team members including our directors) may or may not apply to IPO.

This note is not reviewed by our CIO - Devendra Agrawal, CFA. It is prepared by our team of Investment Analysts, and is reviewed by our senior team members. Any questions related to the IPO can be directed to shubham@deltainvest.in and we will come back.

We at Delta Partners continue to analyze many business and IPOs. Investors interested to be part of this network are requested to fill the form & our team will reach out with more details. [Click Here]

Delta’s View : Track

SEDEMAC manufactures controller units for 2W/3W & Industrial OEMs holding a significant share in ISG controllers (~35%) & Genset controllers (~75%) in India, in a space dominated by global manufacturers. While its revenue remains concentrated to TVS Motor (~75% in 9M FY26), the company continues growing at 27% (5 yr CAGR) and increased operating margins to 20% (9M FY26). Its capacity utilization remained strong and the company plans to expand to 2 new facilities to support growth. However, an IPO ask valuation of ~50x P/E or 6.4 P/S (TTM) seems on a higher side and we would track the company in upcoming quarters for a comforting valuation.

One may expect listing to be flat or even negative as per current GMP -2%, provided the GMP sustains.

SEDEMAC designs & manufactures controller systems for mobility & industrial OEMs in India (>90% share of revenue is domestic) with ~64% exposure to 2W / 3W ICEs. It competes in a segment which is dominated by large-scale global manufacturers (Bosch, Vitesco, Astemo, Shindengen, etc) and other local manufacturers and has managed a ~35% market share in domestic ISG ECU for 2W+3W and 75-77% market share for Genset controller in India. It has expanded its revenue at 5 yr CAGR of 27% and increased operating margins to 18% (FY25), led by combined capacity utilization increasing to over ~85%, demand from key customer (TVS Motor derived ~80% of revenue in FY25) and exports to industrial OEMs. The company had a Gross Asset Turn of over 2.7x and incremental ROCE >44% in last 3 years, and plans expansion of Chakan & Hosur facility. It will also increase capacity for EV motor control units in these facilities.

SEDEMAC got early venture support from Nexus India Ventures between 2010 and 2015, backed by Nandan Nilkeni (NRJN Family trust) in 2016–2017 and Iron Pillar in 2018. Renowned institutional investors like A91 partners, 360 ONE (formerly IIFL), Catamaran Ventures (FO of Narayan Murthy), HDFC Life Insurance Company and SINE of IIT Bombay are some other marquee investors in the company.

The company was founded in 2007 by Prof. Shashikanth Suryanarayanan (serving as Managing Director). He had studied Mechanical engineering from IIT Madras and Doctor of Philosophy from University of California, Berkeley. He is also an Associate Professor in the Department of Mechanical Engineering at the IIT Bombay.

The company manufactures control systems & controller units, holding a ~35% market share in the domestic Integrated Starter Generator (ISG) ECU market (volume-based) for 2W and 3W combined as of Fiscal 2025. In the genset controller market, it is the leader in India with an estimated market share of 75%-77% as of December 31, 2025.
It has expanded its revenue by 27% CAGR over 5 years to 658 cr (FY25) and 771 cr (9M FY26). The company has over 80% of its revenue (FY25) concentrated to its leading OEM customer, TVS Motor Company Ltd which has been its customer from over 7 years since 2018. Its other leading customers include Bajaj Auto, Kirloskar Oil Engines, Briggs and Stratton LLC, DEIF India and Cummins India.
The company's operating margins increased to 20% (9M FY26) from 10% (FY22) driven by increased capacity utilisation in its Chakan facility (~93%) and Wadgaon facility (~81%), amid high demand from its key auto customer (TVS) and exports of industrial controllers.
SEDEMAC derived ~64% of revenue from ISG and ISG+EFI ECU products for the ICE 2/3W industry, and 6% of revenue (9M FY26) from EV products. The company has committed capex towards EV production, including setting up Manufacturing Facility 4 (MF4) for electric motors and acquiring 13.45 acres of land in Hosur for an industrial unit for controllers, ECUs, and electric motors.
The company invested capex of over 100 cr in 9M FY26 with committed expansion of 80,000 sq. ft. unit in Chakan and Hosur facility on 13.45 acres. The Gross Fixed Asset Turns averaged over 2.7x and incremental ROCE was over 44% for the period between FY23-FY25, making a strong case in future if the utilization continue. The company has also deleveraged in FY25, reducing D/E ratio to 0.2x.
SEDEMAC has invested over 40-50 cr each year on R&D which was 7-10% of the revenue generated over the corresponding period. The company also has a team of 150+ engineers from IIT/NIT/BITS which strengthen its R&D and engineering department.
The company's raw materials include semiconductors (74% of raw materials cost), PCBs (8%), die-cast metal and plastic parts, casings, and motors. Its raw material supply is dependent only 8% (9M FY26) on China, and its top 10 suppliers contributed 64% of total purchases during the same period.

Business

SEDEMAC designs & manufactures control systems & controller units for mobility (2W / 3W + EV) and industrial generator markets. Key products include sensorless Integrated Starter Generator (ISG) ECUs, Electronic Fuel Injection (EFI) ECUs, and integrated ISG+EFI controllers. The company also manufactures Genset Control Units (GCU) and Electric Vehicle (EV) Motor Control Units (MCU).
The company operates across two primary segments: Mobility (ICE and EV 2/3W) and Industrial (Generators). The Mobility segment contributed 85% of revenue, while the Industrial segment accounted for 15%. Within mobility, ICE-powered two-wheelers remain the largest revenue driver.
The business is highly concentrated around TVS Motor Company, its anchor customer since 2018, which contributed 75% of total revenue in 9M FY26. Other top clients include Bajaj Auto, Kirloskar Oil Engines, and Cummins India. Geographically, 90.80% of revenue is domestic (India), with 9.20% from exports to the USA and Europe. The industrial segment is more export-oriented, with 69% of its units sold outside India in 9M FY26.
Operations are centered in Pune, across two operational plants: MF1 (control-intensive products) and MF2 (non-critical components). MF1 has a capacity of 4.37 million ISG equivalent units with a high utilisation of 93% (9M FY26). MF2 has a capacity of 3.31 million physical units with 81% utilisation. To support expansion, the company has secured 13.45 acres in Hosur and is setting up two additional units (MF3 and MF4) in Chakan.
Semiconductors are the most critical raw material, accounting for 74% of material costs in 9M FY26, followed by PCBs at 8%. Major suppliers include Avnet Asia, Rabyte Pte. Ltd., and Arrow Electronics.
Its key products across Mobility and Industrial can be explained as :

Its mobility products include -

ISG Controller (Integrated Starter Generator) - Older bikes had separate parts to start the engine and charge the battery, which got transformed into 1 smart machine that does both. ISG Controller switches between both and improves performance & mileage.
EFI ECU (Fuel Injection Brain) - Older bikes used carburetors (for fuel mixing) while newer bikes started using fuel injection. This ECU decided how much fuel to inject & adjusts for throttle, temperature, air pressure, making engines efficient & emission compliant.
ISG + EFI ECU - Both brains combined into 1 smarter box
EV Motor Controller (MCU) - When a battery is installed into EV, it needs instructions on how it will run which includes Speed / Torque / Acceleration / Braking, which is decided by the Motor Controller.
AMT Controls - In automatic vehicles, Instead of a human changing gears, electronics change gears & move clutch due to the AMT (Automatic manual transmission).
VRR (Voltage Regulator Rectifier) - Battery needs clean electricity while Engine produces messy electricity. VRR converts this AC to DC, controls voltage and prevents damage.
TCI / Ignition Controller - Controls spark timing in older engines

Its Generator / industrial products include -

Genset Controller (GCU) - A generator gives backup electricity. This controller starts the generator, monitors voltage, keeps power stable and stops it if something goes wrong.
Genset EFI ECU - It controls fuel injection in the generator engine.
Electronic Governor - It adjusts engine power and control engine RPM from fluctuating too much
Control Panel - The display + buttons + system that operator sees like a generator dashboard
Actuators - Controllers send commands and actuators physically move things like Move throttle & Open valve.

Issue Details

No Fresh Issue

Offer For Sale size - Amount → 1,087 cr;

Promoters and Leadership

The company was founded in 2007 by Prof. Shashikanth Suryanarayanan (serving as Managing Director). He had studied Mechanical engineering from IIT Madras and Doctor of Philosophy from University of California, Berkeley. He is also an Associate Professor in the Department of Mechanical Engineering at the IIT Bombay.
SEDEMAC got early venture support from Nexus India Ventures between 2010 and 2015, having backed by Nandan Nilkeni (NRJN Family trust) in 2016–2017 and Iron Pillar in 2018. Renowned institutional investors A91 partners, 360 ONE (formerly IIFL), Catamaran Ventures (FO of Narayan Murthy), HDFC Life Insurance Company and SINE of IIT Bombay are some other marquee investors in the company.
The promoters & promoter group collectively owned ~26% stake as of RHP date

Financials