GNG Electronics IPO: Should You Subscribe?

The initial public offering (IPO) of GNG Electronics Ltd (GNG) opened for subscription today and will close on Friday, July 25, 2025. The grey market premium (GMP) for the IPO is hovering around Rs 105, indicating a 44% premium.

However, investors are advised to carefully consider both the opportunities and risks before subscribing. For a detailed review, see our comprehensive IPO analysis here.

GNG Electronics IPO Details 

• Issue Details: Mainstream
• Issue Size: Rs 460.44 crore
• Fresh Issue: Rs 400 crore
• Offer for Sale: Rs 60.44 crore
• Price Band: Rs 225 – Rs 237
• Lot Size: 63 shares
• Listing Date: July 30, 2025

Overview of GNG Electronics Ltd

GNG Electronics is India’s largest refurbisher and distributor of Information and Communication Technology (ICT) products, including laptops, desktops and accessories, operating under its flagship brand "Electronics Bazaar." The company has developed a vertically integrated business model that spans sourcing, refurbishment, certification, retail and post-sale support.

GNG operates 5 advanced refurbishment and logistics facilities across India, the UAE and the US, with presence in ~38 countries through 4,150+ touchpoints. It collaborates with leading Original Equipment Manufacturers (OEMs) such as HP, Lenovo and Dell, and holds key certifications that underscore its commitment to quality and sustainability.

GNG Electronics Key Strengths

• Market Leadership: GNG is India’s largest refurbisher of laptops and desktops and ranks among the largest refurbishers of ICT devices globally. The company has a strong presence across India, the UAE and the US.
• Solid Financial Performance: Between FY23 and FY25, GNG delivered strong financial performance with a 46% CAGR in operating revenue, 59% in EBITDA and 46% in net profit.
• Healthy Return Metrics: GNG showcases strong operational efficiency, with a Return on Equity (RoE) of 30.4% and Return on Capital Employed (RoCE) of 17.31% as of FY25.
• Margin Profile: GNG posted an impressive EBITDA margin of 8.94% and a net profit margin of 4.89% in FY25, significantly outperforming its peer.
• Strong Procurement Network: GNG has built robust long-term relationships with procurement partners, growing its procurement network from 265 partners in FY23 to 557 in FY25, with plans for further expansion. Strategic partnerships with brands like HP and Lenovo enhance credibility and strengthen the company's market positioning.

GNG Electronics Risk Factors

• Client Concentration: As of FY25, approximately 47% of GNG’s revenue was derived from its top ten customers. A decline in business from these key customers could negatively impact the company’s operations and financial performance.
• Dependency on Subsidiary: In FY25, 66.66% of GNG’s operating revenue was derived from its material subsidiary, Electronics Bazaar FZC (EB FZC). The company's financial performance is closely linked to the operating income and cash flows of this subsidiary. Any adverse changes in EB FZC’s business, or modifications in GNG’s shareholding in EB FZC, could materially impact its overall operations and financial condition.
• Cash Flow Concerns: GNG has experienced negative cash flow from operations for the past three fiscal years. Continued negative cash flows could jeopardize business continuity and financial stability.
• Legal Risks: GNG and its promoters are currently involved in legal proceedings amounting to approximately Rs 55 crore. Adverse outcomes from these legal proceedings could harm the company's reputation and business prospects.

Final Thoughts: Should You Subscribe to GNG Electronics Ltd’s IPO?

GNG Electronics is India's largest refurbisher of laptops and desktops. The company has delivered strong growth from FY23–25, underpinned by solid return metrics and profit margins.

As of March 31, 2025, the total outstanding borrowings stood at Rs 434.36 crore. GNG plans to use the IPO proceeds to repay Rs 320 crore of debt in FY26, which will significantly reduce interest costs and further boost profitability.

In terms of valuation, the IPO is priced at a P/E multiple of 33x based on FY25 earnings, which appears reasonable. The global refurbished electronics market is projected to grow at a 17.4% CAGR, with India’s market expected to expand at 30% through FY30. GNG has already doubled its customer base in the past two years and is actively expanding its operations across key regions. With a solid position in this rapidly growing market, the company is well-positioned for sustained future growth.

Given these factors, investors are advised to subscribe to the IPO from a medium-to-long-term perspective.

For a deep dive into other IPOs, explore: IPO Corner on Liquide