Pace Digitek IPO

Pace Digitek Limited IPO Strengths

Comprehensive Solutions for India’s Evolving Telecom Infrastructure

Pace Digitek Limited is a fully integrated, end-to-end solutions provider in the telecom tower sector, offering intelligent power systems, turnkey project execution, and lifecycle services. With a strong foothold in passive infrastructure—comprising ~70% of wireless network setup costs—and growing EPC presence, it has adapted to the evolving demands of India’s rapidly expanding telecom and optical fibre markets

Diversified Operations with a Robust Order Book

Pace Digitek Limited began with passive equipment manufacturing and has grown into a multi-segment player across telecom, energy, ICT, and solarisation projects. With backward integration, strategic acquisitions, and expansion into DC systems and ICT, the company now boasts a strong, diverse order book of ₹63,424 million as of September 30, 2024, reflecting sustained revenue growth and operational resilience.

Technically Driven Leadership with Skilled In-House Expertise

Pace Digitek Limited is steered by an experienced Board and technocrat Promoter Maddisetty Venugopal Rao, backed by a qualified senior management team and 1,189 technically proficient employees. With a dedicated R&D centre and skilled in-house project teams, the company drives innovation, enhances execution efficiency, reduces third-party reliance, and maximises returns through its integrated, technically advanced operational structure.

State-of-the-Art Manufacturing Facilities with Growing Production Capabilities

Pace Digitek Limited, through its subsidiary Lineage, operates three advanced manufacturing units in Bengaluru, Karnataka, spanning 200,000 sq. ft. These ISO and CMMi Level 3 certified facilities produce passive infra equipment, lithium-ion battery systems, and soon, BESS. Despite current underutilisation, production has steadily increased, reflecting improved operational efficiency and readiness for future capacity expansion.

Strong Financial Track Record with Consistent Growth

Pace Digitek Limited has demonstrated robust financial and operational performance, marked by steady growth in revenue, EBITDA, and profit after tax over the last three fiscals. With rising margins, improved EPS, and healthy returns on equity and capital employed, the company’s strategic efficiency reflects its ability to sustain profitability while maintaining a solid financial foundation.

More About Pace Digitek Limited

Pace Digitek Limited is a seasoned, multi-disciplinary solutions provider with a primary focus on the telecom passive infrastructure (Passive Infra) sector. With pan-India operations and an international footprint across Myanmar and Africa, the company has steadily evolved from a manufacturer of passive electrical equipment into a diversified infrastructure player.

Evolution and Expansion

• Initially launched as a passive electrical equipment manufacturer, Pace Digitek has since diversified into products, projects, operations & maintenance (O&M), and customised services.

• In FY 2014, it acquired GE Power Electronics India’s business and rights over the ‘Lineage Power’ brand, enabling the full-scale manufacture of direct current systems for telecom applications.

• Since FY 2023, the company has backward integrated product supply via its subsidiary, Lineage Power Private Limited.

• It has been involved in solarizing telecom towers, including the supply and O&M of lithium-ion battery systems, since FY 2013.

Business Verticals

Pace Digitek’s operations are segmented into:

• Telecom:

• Manufacturing passive equipment

• O&M for telecom towers and optical fibre cable (OFC)

• Turnkey projects including tower and OFC network erection

• Energy:

• Solar projects on a build, own and operate model

• EPC-based rural electrification

• Lithium-ion battery system manufacturing

• ICT:

• Smart surveillance systems, classrooms, and kiosks for agriculture

Product & Service Offerings

• Products:
  Through Lineage:

• Power management systems, hybrid DC systems, solar charge units, lithium-ion batteries

• Emerging focus on Battery Energy Storage Systems (BESS)

• Services:

• Installation, commissioning, AMC, lifecycle management, and telecom O&M

• Projects:

• Turnkey solutions in telecom, transmission, ICT, and solar sectors

Manufacturing Infrastructure

• Three facilities in Karnataka (two operational, one upcoming by April 2025), covering 200,000 sq. ft.

• ISO and CMMi Level 3 certified for quality, security, and environmental compliance

Clientele and Financial Growth

• Strong client retention: Top 10 customers averaged 10 years of engagement

• Revenue rose from ₹4,056.98 million (FY 2022) to ₹24,344.89 million (FY 2024)

• Profit after tax grew from ₹115.02 million to ₹2,298.71 million over the same period

Leadership and Workforce

Backed by experienced promoters and a dynamic Board, Pace Digitek employs 1,296 permanent staff, including an 18-member R&D team as of February 28, 2025.

Industry Outlook

India’s infrastructure landscape is undergoing a significant transformation, driven by robust growth across sectors such as telecom, energy storage, and information and communication technology (ICT). This evolution presents substantial opportunities for companies like Pace Digitek Limited, which operates at the intersection of these dynamic industries.

Telecom Passive Infrastructure

India’s telecom sector is experiencing rapid expansion, fueled by the proliferation of 5G technology, increased data consumption, and the digitalization of rural areas. The government’s initiatives, including the “Digital India” program, aim to enhance connectivity nationwide, necessitating extensive development of telecom towers and optical fiber networks. This surge in infrastructure demands robust passive components, such as power management systems and hybrid DC solutions, aligning with Pace Digitek’s product offerings.

Lithium-Ion Battery and Energy Storage

The Indian lithium-ion battery market is poised for substantial growth, with projections estimating an increase from USD 5.78 billion in 2025 to USD 16.09 billion by 2030, reflecting a CAGR of 22.72% . This growth is driven by the rising adoption of electric vehicles, the integration of renewable energy sources, and the need for efficient energy storage solutions. The discovery of domestic lithium reserves and government incentives further bolster this sector, providing a conducive environment for manufacturers like Pace Digitek to expand their battery production capabilities.

Solar Energy

India’s commitment to renewable energy is evident through initiatives like the Pradhan Mantri Surya Ghar Muft Bijli Yojana, which aims to provide solar power to approximately 1 crore households . The country’s solar energy market is projected to reach 500 GW of non-fossil power capacity by 2030 . This ambitious target underscores the demand for solar modules, lithium-ion batteries, and related infrastructure, areas where Pace Digitek has established expertise.

Information and Communication Technology (ICT)

India’s ICT sector is expanding rapidly, with the enterprise ICT market expected to grow at a CAGR of over 17% from 2023 to 2028, reaching more than USD 354 billion . This growth is propelled by digital transformation initiatives, increased cloud adoption, and the proliferation of smart solutions. Pace Digitek’s involvement in ICT projects, including smart classrooms and surveillance systems, positions it to capitalize on this upward trend

How Will Pace Digitek Limited Benefit

• Pace Digitek stands to benefit from India’s booming telecom sector, leveraging its strong capabilities in passive infrastructure, tower erection, and OFC network solutions.

• With growing demand for 5G and rural connectivity, its power management systems and hybrid DC units are well-positioned for high adoption.

• Rising lithium-ion battery demand supports the company’s battery manufacturing and solar telecom tower projects, especially after its acquisition of Lineage Power.

• Expansion into solar energy aligns with national goals, boosting prospects for its solar modules and EPC rural electrification ventures.

• As the ICT sector accelerates, its smart classroom, surveillance, and agricultural kiosk projects are poised for scale.

• Its strong backward integration, through Lineage Power, enhances control over supply chains and quality.

• High client retention, revenue growth (6x in two years), and a certified, scalable manufacturing base further strengthen its competitive edge.

• Ongoing investment in R&D and pan-India presence ensure sustained innovation and market responsiveness.

Peer Group Comparison

Name of the Company	Face Value (₹)	Revenue (₹ in Millions)	Basic EPS (₹)	P/E	RoNW (%)	NAV (₹)
Pace Digitek Limited	2	24,344.89	14.63	[●]	40.67	35.97
Peer Groups
HFCL Limited	1	44,650.50	2.33	34.86	8.34	27.95
Exicom Tele-Systems Limited	10	10,195.98	6.70	21.88	8.86	75.65
Bondada Engineering Limited	10	8,007.22	23.14	16.37	27.55	83.98

Key Strategies for Pace Digitek Limited

Expansion into Battery Energy Storage Systems (BESS)

Pace Digitek Limited, through its subsidiary Lineage, aims to manufacture lithium-ion-based BESS solutions with global-standard certifications, addressing India’s rising renewable energy demands. The company is setting up a 2.5GWh facility in Karnataka, aligned with the country’s sustainable infrastructure development initiatives.

Establishment of Advanced BESS Manufacturing Infrastructure

Pace Digitek is developing a state-of-the-art BESS plant in Karnataka, featuring 12-rack containerized lithium iron phosphate systems. Equipped with PCS, EMS, and multiple safety features, the facility will deliver high-efficiency, long-cycle BESS units tailored for India’s renewable energy and grid stability requirements.

Diversification and Geographical Expansion in Infrastructure Services

Pace Digitek intends to enhance telecom and solar services across India, entering regions like Maharashtra and Jammu & Kashmir. It plans to undertake solar pump projects, participate in the Indian Railways’ KAVACH Project, and expand Passive Infra and BESS offerings in African markets.

Focus on Energy Sector Growth and Backward Integration

To boost energy sector revenue, Pace Digitek targets solar power projects with integrated energy storage. It plans to manufacture solar modules and cells in-house, ensuring complete control over its supply chain and long-term participation in large-scale renewable infrastructure projects under long-term operating models.