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Industry : Construction

Vishnu Prakash R Punglia View all IPOs

Price Band

Rs. 94 – Rs. 99

Vishnu Prakash is going public with a Fresh Issue. The issue opens on 24th August 2023.

MOJO CALL

Why

MOJO CALL

Avoid

Neutral

Good Financials with Growth in Both Topline and Bottom Line

Over the last two years, the company has grown significantly on both the top and bottom lines. Revenue has increased by 55%, while net profit has grown by 118%. The government recently allocated a substantial budget to water supply projects, railways, and highways, all of which the company operates in. This will further expand the company's margins in the future.
The RONW of the company which stands at 38% is significantly higher than its peers but the only concern is that the company reported negative cash flows in FY22 and FY23.

Fair Valuation

The company is fairly priced, with a PE of 13x and a Market Cap-to-Sales ratio of 1.1x, which is comparable to what its peers are valued at. We feel that this company will gain from the government's reforms, hence we recommend subscribing to this IPO.

Issue Details

Issue Opens	24th August 2023
Issue Closes	28th August 2023
Price Band	Rs. 94 – Rs. 99
Issue size (Upper Band)	Rs. 309 Cr
Issue Type	FRESH ISSUE
Market cap (based on upper band)	Rs. 1234 Cr
Sales- March 2023 (Rs./Crs)	1171 Cr
Net Profit - March 2023 (Rs./Crs)	91 Cr
Industry	Construction
Promoters	Vishnu Prakash
Lead Manager	Pantomath Capital

Objective of the Issue

Details

Objectives of the Issue Fresh Issue & Offer for Sale – Rs. 309cr

The Objectives of the Offer are for:
1. Capital expenditure to purchase machinery.
2. Funding working capital requirements of the company.
3. General corporate purposes.

List of Shareholders Selling Their Stake

Business Operations

About Company

Vishnu Prakash R Puglia is involved in the design and construction of Infrastructure projects for Central and State governments.

The operate in 4 segments:
1. Water supply Projects
2. Railway projects
3. Road Projects
4. Irrigation Network Projects

Majority of the revenue of the company comes from Water Supply Projects at 85%, followed by Railway and Road projects.

The company operates in 9 states and 1 union territory in India.

Segment Revenue Breakup

Revenue breakdown by Segment:
Segment	FY 23	FY 22	FY 21
Water Supply	85%	86%	79%
Railway	7%	11%	17%
Road	6%	0%	0%
Irrigation	1%	2%	4%
Other	1%	1%	0%

Financials

Financial Overview

The company’s sales saw a healthy growth in the last two years at 55%

ROCE stood at 33.72% showing an improvement as compared to previous years.

The company has reported negative cash flows in FY22 and FY23 of Rs 33 crore and Rs 84 crore, respectively.

Debt increased to Rs 2503 crore in FY23 as compared to Rs 1107 crore in FY22

Financial Performance (Rs/crore)

Rs./Crs	FY 23	FY 22	FY 21
Sales	1171	787	487
Net Profit	91	45	19