The initial public offering (IPO) of Vishnu Prakash R Punglia continued to receive a robust response from investors. While the issue was fully subscribed within a few hours of its opening; by 2:55 pm on its final day of bidding, the IPO saw 57.17 times subscription against its offer.
It has received bids for 125.37 crore shares against 2.19 crore shares on offer.
The category for non-institutional investors (NII) was subscribed to the most, 95.03 times, followed by the portion reserved for qualified institutional buyers (QIBs), which was subscribed to 81.51 times. Meanwhile, the retail investors' quota witnessed 28.31 times bids and the part reserved for employees saw 11.24 times subscription.
The NII part received bids for 44 crore shares versus 46.35 lakh shares on offer while the QIB quota received bids for 50.37 crore shares versus 61.80 lakh shares offered. The retail investor category received bids for 30.61 crore shares against 1.08 crore shares on offer. Finally, the employees' portion received bids for 33.71 lakh shares versus the 3 lakh shares on offer.
GMP: The company's shares in the grey market are trading at a healthy premium of ₹55, indicating a strong response to the issue. It has fallen from ₹65 on August 24.
However, one must note that the grey market premium is only an indicator of how the company's shares are performing in the unlisted market and can change quickly.
The ₹308.88-crore IPO of Vishnu Prakash R Punglia was open for subscription between August 24 and August 28 with the price band set in the range of ₹94-99. The issue was entirely a fresh offering of up to 3.12 crore equity shares.
The company had reserved 50 percent of equity shares for qualified institutional bidders, while non-institutional investors had 15 percent of reservation for them. The remaining 35 percent of shares went to the retail investors. The company gave a discount of ₹9 per share to its eligible employees.
Net proceeds from the issue are to be utilised towards funding capital expenditure requirements for the purchase of equipment and machinery, the working capital requirements of the company and general corporate purposes.
Incorporated in 1986, Jodhpur-based Vishnu Prakash R Punglia is an ISO 9001:2015 certified integrated engineering, procurement, and construction (EPC) enterprise. It is engaged in the business of designing and constructing infrastructure projects for the central and state governments, autonomous bodies, and private bodies across nine states and one union territory in India. The company is mainly focused on water supply projects (WSPs) which constitute 78 percent of its outstanding order book. It is also present in projects related to railways, roads, and irrigation.
The company's topline has grown consistently for the past 3 years at a CAGR of 55 percent while EBITDA witnessed an 86 percent CAGR growth over FY21-23. Its EBITDA margins also improved from 9.3 percent in FY21 to 13.4 percent in FY23.
Most brokerages recommended subscribing to the stock on the back of a healthy order book, industry tailwinds, a track record of strong growth, and attractive valuations for the investors. However, dependency on government projects and increasing competition are some key challenges for the firm.
The tentative date for finalisation of the share allotment is August 31, 2023. Meanwhile, it is likely to be listed on the bourses on September 5.
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