Startup Deep Dive : Cygni Energy — revenue halved as it bet on a 4.8 GWh battery gigafactory

Cygni Energy sold ₹102 crore of batteries and power electronics in the year to March 2023. Two years later, in the year to March 2025, that number had fallen to ₹38.4 crore — a drop of more than three-fifths — and yet, in the middle of that slide, the company cut the ribbon on a 4.8 GWh battery gigafactory and sat on a confirmed order pipeline of roughly ₹533 crore.

That contradiction is the whole story of Cygni Energy Private Limited, a Hyderabad company incubated on patented IIT Madras technology. Its first business was quietly profitable, its second nearly broke it, and its third — grid-scale storage — is the bet that everything now rides on. This is a deep dive into how a company kept re-inventing what it sells, and why its revenue and its ambition have been moving in opposite directions.

Quick facts

What Cygni Energy does

Cygni designs and assembles lithium-ion battery packs and stationary energy storage, and sells them business-to-business rather than to consumers. Its three product families, as described in the CARE Ratings press release of December 2025, are:

• EV battery packs for two-wheelers and three-wheelers, sold to electric-vehicle original equipment manufacturers (OEMs).
• Battery Energy Storage Systems (BESS) — grid-scale DC blocks that it supplies, installs and commissions for renewable-power and data-centre customers.
• Solar DC and AC products, the inverter-less direct-current systems that were the company’s original line.

The manufacturing base is a 4.8 GWh gigafactory at the Electronics Manufacturing Cluster in Maheshwaram, Hyderabad — a 160,000 sq ft plant on a 5-acre campus that the company opened on 30 April 2025 and describes as India’s first LEED-qualified battery gigafactory (company-stated).

The origin: a chip designer comes home

Cygni’s founder, Venkat Rajaraman, did not start in energy. He holds a master’s in electrical engineering from Stanford University and spent years in Silicon Valley designing semiconductors, including a stint as head of engineering at PortalPlayer — the company behind the chips inside early iPods — which was later acquired by NVIDIA. He then ran Su-Kam Power Systems, one of India’s better-known power-backup brands, as CEO.

The founding insight in 2014 was narrow and technical: in a country with unreliable grids and abundant sun, the wasteful step is conversion. A conventional solar setup turns DC from panels into AC, then back into DC for the batteries and the growing fleet of DC appliances — losing energy at each hop. Cygni’s answer, built on patented IIT Madras research, was an inverter-less DC architecture that kept the electricity as direct current end to end. For roughly five years, from 2015 to 2020, that solar DC business — off-grid and grid-tied — was what Cygni was.

The struggle years: two pivots and a subsidy shock

Cygni is not a straight-line story. It has changed what it sells twice, and each change carried the risk of leaving its old revenue behind before the new revenue arrived.

• 2020 — the EV pivot. The solar DC company reinvented itself as a battery-pack company, supplying lithium-ion packs of varying capacities to electric two-wheeler makers. This was the bet that produced the ₹102 crore revenue peak in FY23.
• 2023 — the policy shock. The two-wheeler engine of that growth stalled. As CARE Ratings records, electric two-wheeler OEMs were hit by the reduction of subsidies under the FAME-II scheme and stricter compliance requirements introduced in 2023. OEMs cut production; their purchases of Cygni’s battery packs fell with them.
• 2024-2025 — the losses. Falling two-wheeler volumes, inventory that had to be liquidated at reduced demand, and fixed factory overheads combined into operating losses in both FY24 and FY25. The net-worth base eroded, though it held at a moderate ₹75 crore as on 31 March 2025.
• 2025 — the second pivot. Rather than defend the shrinking two-wheeler line, Cygni commissioned a facility for three-wheeler battery packs (production began May 2025) and leaned hard into grid-scale BESS.

The turning point: the two-wheeler collapse

The single event that defines Cygni is the collapse of its two-wheeler revenue, because it forced the third pivot. The numbers on either side are stark. Total operating income was ₹102.12 crore in FY23, the year the EV-battery bet paid off. By FY25 it was ₹38.40 crore — a fall of about 62% in two years. Profit told the same story in reverse: a thin net profit of ₹0.25 crore in FY23 became a loss of ₹7.02 crore in FY24 and ₹8.65 crore in FY25 (all audited figures, per CARE Ratings, December 2025).

What makes it a turning point rather than a decline is what Cygni did with the shock. Instead of a company doubling down on a policy-exposed consumer-EV supply chain, it repositioned as a supplier of DC blocks to renewable-power and data-centre projects — a tender-driven, infrastructure business with a very different rhythm. The 4.8 GWh gigafactory, opened in April 2025 for an investment of over ₹100 crore, is the physical expression of that decision: capacity built for storage at grid scale, not scooters.

The money behind it

Cygni has raised money in slow, spaced-out rounds rather than a rapid venture cadence. The documented shape:

• Seed / incubation: support from IIT Madras, where the company began.
• Series A — 16 August 2018: about $6.4 million in equity and debt. Endiya Partners led the equity (reported at ₹15 crore), with debt from IndusInd Bank (Mercom India; Chambers).
• Series B — 27 August 2022: ₹100 crore (about $12.5 million at the time), a mix of equity from Meridian Global Ventures and debt from Indian Overseas Bank (EVreporter).
• Promoter infusions: in FY22 and FY23 investors put in over ₹53 crore, used to fund losses and set up the new plant (CARE Ratings).
• Latest round — reported April 2026: ₹60 crore from existing backer Meridian Global Ventures via 4,16,667 compulsorily convertible preference shares at ₹1,440 each, at a reported post-money valuation of about ₹244 crore, taking Meridian’s stake to 49.23% (Entrackr).

The defining backer is the Saraogi family, which owns Go Fashion India (the Go Colors brand) and invests through Meridian Global Ventures; the investment is led by Rahul Saraogi. CARE Ratings notes the family holds around 65.7% of Cygni’s equity and treats this promoter support as a key mitigant to the company’s operating losses. Total capital raised to date is reported at roughly $19 million by Entrackr, though startup databases such as Tracxn put the tracked figure higher at around $25 million to $28 million — treat the exact total as contested and the lower, transaction-anchored figure as the more conservative read.

How it makes money

Cygni is a hardware business, so the economics are about cells, conversion and cash cycles rather than software margins. The mechanics:

• Money in: sales of battery packs to EV OEMs, and supply-install-commission contracts for BESS DC blocks won largely through tenders.
• Costs out: imported lithium-ion cells are the dominant input, and they carry a lead time of 1.5-2 months, forcing Cygni to hold high inventory.
• Where the cash gets stuck: the working-capital cycle ran to 438 days in FY25 (424 days the prior year), per CARE — well over a year between paying for cells and collecting from customers. The company gives customers 30 days’ credit while suppliers give it 30-45 days, so it funds the gap with bank borrowing; average cash-credit utilisation was 91% over the 12 months to October 2025.
• The pricing catch people miss: BESS contracts are awarded on lowest-bid (L1) tenders. That restricts pricing flexibility and makes order inflow uncertain — you can win the work and still make little on it.

The numbers

The audited three-year picture, from the CARE Ratings press release of December 2025, shows a business that shrank and slipped into losses even as it invested:

The trend is the point: revenue down two years running, operating losses widening from ₹1.17 crore to ₹13.97 crore, and leverage more than quadrupling as the company borrowed to fund both losses and the new plant. Net worth stood at ₹75 crore as on 31 March 2025. CARE assigned the bank facilities a CARE BB+ (Stable) long-term rating in December 2025 — sub-investment-grade, reflecting exactly this strain.

Where the money comes from

The revealing detail is not the split today but the concentration behind it, and the pipeline that is meant to replace the lost two-wheeler sales:

• Customer concentration: the top five customers have historically accounted for over 90% of revenue — and CARE flags that the new BESS wins are also concentrated among just four clients.
• The BESS order book: a confirmed business pipeline of about ₹533 crore (roughly $56 million at $1 ≈ ₹96.0), primarily supply, installation and commissioning of DC blocks. That is nearly 14 times FY25 revenue, which is why it matters.
• Named counterparties: the BESS pipeline is anchored by strong buyers — the Ctrl-S group, the Greenko group, and HG Infra Engineering Limited (CARE Ratings).
• The segment shift: from two-wheeler packs (the FY23 peak) toward three-wheeler packs (production from May 2025) and grid-scale storage — a deliberate move away from subsidy-dependent consumer EVs toward infrastructure demand.

The surprise is the mismatch: a company doing under ₹40 crore of revenue is carrying an order book more than ten times that size. The gigafactory and the losses only make sense if that pipeline converts into billed, collected revenue.

The risks

Cygni’s own lenders spell out the concrete risks, and they are worth taking at face value:

• Liquidity is stretched. CARE describes the liquidity position as “stretched”, with expected cash accruals tightly matched against a debt repayment obligation of about ₹3 crore in FY26 and cash-credit lines running at 91% utilisation — little cushion if a BESS project slips.
• Tender pricing and order volatility. Because BESS work is won on L1 tenders, Cygni cannot set its own price and cannot count on a steady order flow; a dry spell in tender wins would hit revenue visibility directly.
• Client concentration. With the top five customers at over 90% of revenue and the BESS pipeline spread across only four clients, a delay or dispute at one large buyer could materially dent cash flows.
• Execution and import dependence. The whole turnaround assumes the ₹533 crore pipeline is delivered on time using imported cells with 1.5-2 month lead times, into a 438-day working-capital cycle — an operationally demanding combination.

The takeaway

Cygni Energy is a case study in a hard truth about hardware startups tied to subsidy: a policy line item can be worth more than a year of engineering. The FAME-II changes of 2023 did to Cygni’s two-wheeler revenue what no competitor could, and the company’s response — pivot the product, not just the pitch — is the transferable lesson. It moved from a demand pool it could not control (consumer EV subsidies) toward one with longer contracts and named industrial buyers (grid storage), and it built the factory before the revenue arrived. Whether that is foresight or overreach depends entirely on the ₹533 crore pipeline turning into cash. The gigafactory is built; the order book is signed; the only thing still unproven is collection.

Frequently asked questions

What does Cygni Energy make?

Cygni Energy Private Limited makes lithium-ion battery packs for electric two- and three-wheelers, grid-scale Battery Energy Storage Systems (BESS), and solar DC and AC products. It sells to EV manufacturers and to renewable-power and data-centre projects, and manufactures at a 4.8 GWh gigafactory in Maheshwaram, Hyderabad.

Who founded Cygni Energy and when?

It was founded in 2014 by Venkat Rajaraman, a Stanford-trained electrical engineer who previously designed semiconductors at PortalPlayer (later acquired by NVIDIA) and served as CEO of Su-Kam Power Systems. The company was incubated on patented IIT Madras technology.

Is Cygni Energy profitable?

No. Per audited figures in the CARE Ratings press release of December 2025, Cygni made a small net profit of ₹0.25 crore in FY23 but posted net losses of ₹7.02 crore in FY24 and ₹8.65 crore in FY25, as its two-wheeler battery revenue fell.

How much has Cygni Energy raised, and who are its investors?

Reported total funding is roughly $19 million (Entrackr), with some databases tracking $25-28 million. Backers include Endiya Partners (Series A, 2018), Indian Overseas Bank and IndusInd Bank on debt, and the Saraogi family (owners of Go Fashion India / Go Colors) through Meridian Global Ventures, which led a reported ₹60 crore round in April 2026 at about ₹244 crore post-money.

Why did Cygni Energy’s revenue fall?

Its main business was battery packs for electric two-wheelers. When FAME-II subsidies were cut and compliance rules tightened in 2023, two-wheeler OEMs reduced production and bought fewer packs. Cygni’s total operating income fell from ₹102.12 crore in FY23 to ₹38.40 crore in FY25, prompting a pivot toward three-wheeler packs and grid-scale storage.

Sources

Figures are as of September 2026. Currency converted at $1 ≈ ₹96.0 as of 18 September 2026 (Trading Economics).

• CARE Ratings (CareEdge), press release on Cygni Energy Private Limited, December 2025 — audited FY23-FY25 financials, net worth, gearing, order book, working-capital cycle, shareholding.
• Entrackr, “Meridian Global nears controlling stake in Cygni Energy with fresh funding”, April 2026 — ₹60 crore round, ₹244 crore post-money, 49.23% stake, total raised.
• EVreporter, “Cygni Energy raises INR 100 crores in Series B investment”, September 2022 — Series B amount, Meridian Global Ventures, Indian Overseas Bank.
• Mercom India, “Cygni Energy Commissions 4.8 GWh BESS Gigafactory in Hyderabad”, 2025 — gigafactory capacity, investment, phases, delivered MWh.
• pv magazine India / SolarQuarter / Renewable Watch, April-May 2025 — gigafactory opening on 30 April 2025, 160,000 sq ft, LEED claim, 10.8 GWh by 2027.
• Mercom India / Saur Energy / EQ Mag, 2018 — Series A of about $6.4 million led by Endiya Partners with IndusInd Bank debt.
• Chambers and Partners, Endiya Partners Series A investment note — ₹15 crore equity, August 2018.
• Entrepreneur India / Crunchbase, founder profile — Venkat Rajaraman background (Stanford, PortalPlayer/NVIDIA, Su-Kam).
• Tracxn / Zauba Corp / Tofler, 2025-2026 — legal entity CIN, founding year, tracked funding totals.

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