Why:
- The growth story is narrower than it looks. The exciting part of this company is industrial electric heating, a fifth of revenue. Its one clean year of growth (44.9% in FY26) leaned on what the company itself calls "major order execution", the plant behind it produced 19% fewer units, and the Indian market it serves has grown at 4% to 7% a year by every measure except the one in the company's own paid industry report. Across all three product lines, the company's share of its Indian markets is flat to falling (T1, T2).
- The company was rebuilt around a family merger on terms shown to nobody. In 2025 the two operating promoters merged their own heater company into the issuer and issued themselves 37% of the equity for it, at a valuation available only for inspection, using an accounting method the filing's own policy note says does not apply to deals between parties under common control. That merger moved control from 29% to 55% in their hands, and the diluted branch of the family is now selling 55% to 72% of its holdings in and around this IPO, including a sitting director (T1).
- What is good here is real but not enough. Net cash, 46% gross margins, roughly 15% organic growth and clean audits earned the financial record a pass. Nothing else did (T1).
What the price buys
| Floor ₹285 (T1) | Cap ₹300 (T1) | |
|---|---|---|
| Bid window | 20 to 24 August 2026 | |
| Bid lot | 50 shares | |
| Fresh shares | 3,333,333 | 3,166,666 |
| Post-issue shares | 84,332,914 | 84,166,247 |
| Market capitalisation | ₹2,403 cr | ₹2,525 cr |
| P/E (FY26 profit to owners) | 35.7x | 37.5x |
| EV/EBITDA (company is net cash) | 20.9x | 22.0x |
| EV/EBITDA (after the ₹55 cr earmarked debt repayment) | 20.4x | 21.5x |
| Promoter holding after | 44.1% | 44.2% |
The filing prints no listed peer and no peer P/E at all, so the offer carries no comparison the reader can check it against. The price does not move the verdict; the six ratings judge the business, not the tag.
The story
A buyer of this IPO is being offered an electrification growth story: a 36-year-old Udaipur instruments maker whose industrial heating line grew 45% last year and which says India's process industries will switch from burning fuel to electric heat. The numbers under the story are thinner. Heating became a fifth of revenue mostly by merging in the promoters' own heater company; its one organic growth year leaned on a big order; and the core temperature-sensing business, still 45% of revenue, grows single digits with a flat market share.
What this business is
Tempsens makes three families of industrial hardware on one campus in Udaipur: temperature sensors (thermocouples, RTDs, infrared pyrometers, 45% of FY26 revenue), industrial electric heaters and furnaces (21%), and specialty cables (35%). Customers are process plants and their contractors: petrochemicals, metals, power, defence. It is unusually integrated for its size, melting its own heating alloy and drawing its own conductor wire, and it holds the pressure-vessel and hazardous-area certifications (ASME U-Stamp among them) that decide who may quote for process heaters. About 28% of revenue is exported to 80 plus countries (T1).
Six deals in three years reshaped the group: the Marathon heater merger, sensor makers Pyrosens and Accurate Opto arriving with it, thermocouple plants in Germany and Poland, a gauge maker, and joint ventures in Indonesia and Korea. Revenue grew 27% a year over the window; strip the acquisitions and it grew 11% and then 15% (T1).
Easy or difficult business? The certified end is genuinely hard: a pressure-vessel heater for a refinery needs approvals that take years, and customers qualify suppliers slowly. The uncertified end is commodity, and the filing's own risk factor says the heating segment is "dominated by domestic suppliers, intensifying price competition", while naming no domestic heating competitor anywhere in 500 pages (T1).
Key numbers
| ₹ cr | FY2024 | FY2025 | FY2026 |
|---|---|---|---|
| Revenue | 275 | 379 | 445 |
| Revenue growth % | n/a | 37.7 | 17.5 |
| Gross margin % | 39.2 | 46.9 | 46.0 |
| EBITDA | 61 | 97 | 113 |
| EBITDA margin % | 22.0 | 25.4 | 24.8 |
| PAT | 41 | 63 | 71 |
| PAT growth % | n/a | 52.9 | 13.6 |
The FY25 jump is mostly the Marathon merger consolidating for a full year; organic revenue growth was about 11%. Profit per share tells the owner's version: earnings per share went 8.06, 7.51, 8.35 across the three years, essentially flat, because 37% of the equity was issued to the promoters to pay for the merger. In FY26, bank interest and other non-operating income supplied a large slice of the profit growth, and the operating margin actually gave back about 1.4 points (T1).
| Segment, ₹ cr | FY2024 | FY2025 | FY2026 |
|---|---|---|---|
| Temperature sensing | 165 | 174 | 197 |
| Temperature sensing growth % | n/a | 5.5 | 12.7 |
| Electrical heating | 11 | 63 | 91 |
| Electrical heating growth % | n/a | 492.4 | 44.9 |
| Specialty cables | 97 | 138 | 153 |
| Specialty cables growth % | n/a | 42.3 | 11.1 |
Profit by segment is not disclosed; the group reports one segment. Heating's FY25 arrival is the merger; FY26 sensing growth includes a German distributor that was a top-10 customer until the company bought it in January 2026 (T1).
Scorecard
| Block | Rating | Why |
|---|---|---|
| Right to win | MARGINAL | The edge is real and narrow: certifications that gate process-heater supply, alloy-to-assembly integration few rivals match, ten-year average relationships with its top customers, and 60% of revenue from customers buying more than one product line. What stops a pass: the edge covers a small slice of a 21%-of-revenue segment, its one organic year of proof leaned on a major order by the company's own account, revenue from repeat customers fell in absolute rupees while the company grew 17%, and the technology gate to the big electrification prize (medium-voltage heaters) is still in development. |
| Industry and TAM | MARGINAL | Headroom is real, but the markets that matter grow single digits and share is flat to falling in all three lines. The paid report's exciting heating forecast implies the market growing about 40% a year against a 7% history, with no adoption rate behind it, and its own global chapter says 7%. |
| Financial momentum | PASS | Net cash, 46% gross margin, organic growth around 15%, rising asset productivity, positive and rising free cash flow, clean audits, and the weakest margin year of the three is the filing year, which argues against dressing. Cautions: the cash cycle stretched from 152 to 210 days and earnings per share have gone nowhere for two years. |
| Risks, governance, RPTs | MARGINAL | Clean on the big absences: no pledges, no SEBI matters, no auditor resignation (the auditor was upgraded to a national firm), litigation trivial. Held back by the merger accounting contradicting the filing's own policy note, related-party dealings at 18% of revenue as recently as FY24, an incomplete transfer-pricing study, and an accounting-database audit trail switched off for two straight years. |
| Promoter and cap table | MARGINAL | Real builders: the capabilities they said they were adding show up in the revenue mix, and the balance sheet stayed unstressed. But the family merger shifted control to the two operating promoters at a price nobody outside can check, the diluted branch is exiting through this offer, and the family separately sold half of one group company to a foreign partner for its own account rather than folding it in. |
| Offer structure | MARGINAL | Promoters sell nothing and the paperwork is honest. But 58% of the fresh money repays bank lines a net-cash company does not need, lines personally guaranteed by the MD and by the selling director; the fresh issue is sized just below the level that would trigger an independent monitoring agency; and three of the five stated growth strategies get no earmarked rupee. |
Watch out for
- The merger that made the company also moved it. The promoters' own heater business came in for shares worth 44% of the combined company against a fifth of its revenue, the valuation is available only for inspection, and the accounting method used is one the filing's own policy note excludes for related-party mergers. The visible cost to a reader: the headline three-year growth rates sit on a base year the merger makes non-comparable (T1).
- The sellers know the company best. Five family and legacy holders, none of them running the business, are selling 55% to 72% of what they held a year ago across a December 2025 secondary sale and this offer. One is a sitting director who stays on the board. The institution that bought in December is a pre-IPO fund whose lock-in may already have lapsed by listing day (T1).
- The repeat business shrank while the company grew. Revenue from repeat customers fell in absolute rupees in FY26 and its share dropped from 71% to 46%; the replacement-parts share of revenue has also drifted down for two years against a stated strategy of building it (T1).
- An 8x jump in purchases from a promoter-group supplier in the IPO year. Small today (under 1% of revenue), but the direction deserves watching, and the FY26 transfer-pricing study is not yet complete (T1).
The offer
- Raising ₹95 cr of fresh money plus an offer for sale of 1.85 crore shares, about 23% of the pre-offer share count, by five family and legacy holders (T1).
- For ₹55 cr of bank-debt repayment at a company already net cash, ₹18 cr of machinery and sheds for the heating and cable lines, and the balance for general purposes (T1).
- Implied valuation at the band: ₹2,403 cr to ₹2,525 cr, from the table above.
- Promoters hold 46.1% before the offer, sell nothing, and hold about 44% after; with the wider family, about 65% (T1).
Assessment of the Red Herring Prospectus dated 14 August 2026, which supersedes the draft of September 2025. Outside checks of market sizes, competitors, the merger's accounting and the pre-IPO investor were made and are marked where used (T2/T3). Numbers carry source tiers: (T1) the filing's audited sections and exchange records, (T2) established outside data with a named source, (T3) the issuer-commissioned industry chapter or press. Not a recommendation. The valuation section states what the announced band implies and is not a view on whether that price is right.