Introduction to Deepak Builders & Engineers India Ltd IPO
Deepak Builders & Engineers India Ltd is gearing up for its Initial Public Offering (IPO), aiming to raise a total of ₹260.04 crore. This offering consists of a fresh issue worth ₹217.21 crore, which translates to approximately 1.07 crore shares, alongside an offer-for-sale amounting to ₹42.83 crore, equivalent to around 0.21 crore shares. Investors can expect the company’s shares to be listed on both the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE), marking a significant milestone for the firm.
Investment Requirements
For retail investors, the minimum investment required is ₹14,819, which allows them to purchase one lot of shares. Small Non-Institutional Investors (NIIs) must invest a minimum of ₹207,466 for 1,022 shares, which corresponds to 14 lots. Meanwhile, Large NIIs are required to invest at least ₹1,007,692 for 4,964 shares, or 68 lots. Kfin Technologies Ltd will serve as the registrar for this IPO, while Fedex Securities Pvt Ltd has been appointed as the book-running lead manager.
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Deepak Builders & Engineers India Ltd IPO GMP
As of October 24, 2024, the Grey Market Premium (GMP) for Deepak Builders & Engineers India Ltd stands at ₹50. The IPO has a price band set between ₹192 and ₹203 per share, with an estimated listing price projected at ₹253. This reflects a potential gain of approximately 24.70% per share for investors. The Retail Subject to Sauda is ₹1,800, while the Small HNI Subject to Sauda is ₹25,200, with the GMP fluctuating between a low of ₹11 and a high of ₹40.
Deepak Builders IPO Company Details
Founded in September 2017, Deepak Builders & Engineers India Ltd specializes in constructing a variety of structures, including administrative buildings, hospitals, stadiums, and residential complexes. The company has successfully executed turnkey projects encompassing architecture, civil works, mechanical, electrical, and plumbing (MEP) systems, firefighting systems, medical gas pipelines, IT systems, and landscaping.
Deepak Builders operates in three primary categories: Construction Projects, Infrastructure Projects, and Product Sales. The firm has completed numerous projects across Punjab, Haryana, Rajasthan, Uttarakhand, Chandigarh, and Delhi. Currently, it is engaged in 12 ongoing projects, which include seven Engineering, Procurement, and Construction (EPC) contracts and five item rate contracts. These projects range from hospitals and medical colleges to administrative buildings and railway station developments.
As of June 30, 2024, the company’s order book stands at ₹13,803.89 million for Fiscal 2024. Notable past projects include the 3D Domes at Jang-E-Azadi and the Heritage Walk at the Golden Temple. The company employs a workforce of 632 permanent staff and 2,129 contract workers.
Deepak Builders & Engineers India Ltd IPO Details
- Opening Date: 21st October 2024
- Closing Date: 23rd October 2024
- Face Value: ₹10 per share
- Price Band: ₹192 to ₹203 per share
- Lot Size: 73 Shares
- Total Issue Size: 12,810,000 shares (aggregating up to ₹260.04 Cr)
- Fresh Issue: 10,700,000 shares (aggregating up to ₹217.21 Cr)
- Offer for Sale: 2,110,000 shares (aggregating up to ₹42.83 Cr)
- Issue Type: Book-Built Type Issue
- Listing At: NSE, BSE
- Shareholding Pre-Issue: 35,880,860
- Shareholding Post Issue: 46,580,860
- Basis of Allotment: Thursday, 24th October 2024
- Refund Initiation: Friday, 25th October 2024
- Credit of Shares in Demat: Friday, 25th October 2024
- Listing Date: Monday, 28th October 2024
- Cut-off Time for UPI Mandate Confirmation: 5 PM on 23rd October 2024
Deepak Builders & Engineers India Ltd Lot Size, Shares, and Their Value
| Investor Category | Lots | Shares | Amount |
|---|---|---|---|
| Retail (Min) | 1 | 73 | ₹14,819 |
| Retail (Max) | 13 | 949 | ₹192,647 |
| S-HNI (Min) | 14 | 1,022 | ₹207,466 |
| S-HNI (Max) | 67 | 4,891 | ₹992,873 |
| B-HNI (Min) | 68 | 4,964 | ₹1,007,692 |
Investor Categories and Shares Offered
- QIB Shares Offered: Not more than 50.00% of the offer
- Retail Shares Offered: Not less than 35.00% of the Offer
- NII (HNI) Shares Offered: Not less than 15.00% of the Offer
Deepak Builders & Engineers India Ltd Financials
For the periods ending March 31, 2024, and March 31, 2023, the financial performance of Deepak Builders is as follows:
| Periods Ended | 31st Mar 2024 | 31st Mar 2023 |
|---|---|---|
| Assets | ₹558.75 Cr | ₹449.3 Cr |
| Revenue | ₹516.74 Cr | ₹435.46 Cr |
| Profit After Tax | ₹60.41 Cr | ₹21.4 Cr |
| Net Worth | ₹141.25 Cr | ₹89.35 Cr |
| Reserves and Surplus | ₹124.22 Cr | ₹64.66 Cr |
| Total Borrowing | ₹153.04 Cr | ₹96.57 Cr |
Should You Invest in the Deepak Builders & Engineers India IPO?
Financial Performance
The company reported a revenue of ₹106.34 crore for the period ending June 30, 2024, with a Profit After Tax (PAT) of ₹14.21 crore. The net worth of the company stands at ₹155.81 crore, with total assets amounting to ₹641.1 crore and reserves and surplus of ₹138.23 crore. However, the company has a total borrowing of ₹153.17 crore, which raises some concerns.
Key Performance Indicators (KPI)
- Market Capitalisation: ₹945.59 crore
- Return on Equity (ROE): 8.48%
- Return on Capital Employed (ROCE): 8.97%
- Return on Net Worth (RoNW): 9.57%
- Price to Book Value (P/BV): 4.68
- Debt/Equity: 0.91
- PAT Margin (%): 13.52
Objectives of Deepak Builders & Engineers India Ltd IPO
The net proceeds from the fresh issue will be utilized to service or prepay certain borrowings, meet working capital requirements, and cover other general corporate purposes.
Risks Associated with the IPO
Investors should be aware of several risks associated with the Deepak Builders IPO:
- Financial Health: The company’s focus on specific projects may expose it to financial setbacks.
- Regional Concentration: With a significant concentration in Punjab, the company may be vulnerable to regional policy changes or economic fluctuations.
- Cash Flow Challenges: The company has previously experienced negative cash flows from operations, which could pose future risks.
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Frequently Asked Questions (FAQs)
What is the price band of Deepak Builders & Engineers India IPO?
The price band has been fixed at ₹192 and ₹203 per share.
What is the retail investor quota of Deepak Builders & Engineers India IPO?
A minimum of 35% of the shares will be allocated to retail investors.
Where can I track Deepak Builders & Engineers India’s stock performance?
You can track it on Unicorn Signals after the listing.
How can I apply for Deepak Builders & Engineers India’s Initial Public Offer?
You can apply through your demat account or through your bank/financial institution during the IPO period.
When is the last date of IPO subscription for Deepak Builders & Engineers India?
The cut-off time is on October 23, 2024, by 5 PM; however, most brokers do not accept applications after 1-3 PM.
In conclusion, the Deepak Builders & Engineers India Ltd IPO presents an intriguing opportunity for investors, but it is essential to weigh the potential rewards against the associated risks. As always, thorough research and consideration of personal financial circumstances are crucial before making investment decisions.