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Capacite Infraprojects Limited IPO Review – Should you Invest?

Issue Detail:

»» Issue Open: Sep 13, 2017 – Sep 15, 2017
»» Issue Type: Book Built Issue IPO
»» Face Value: Rs 10 Per Equity Share

»» Issue Price: Rs 245 – Rs 250 Per Equity Share
»» Market Lot: 60 Shares
»» Minimum Order Quantity: 60 Shares

»» Finalisation of Basis of Allotment: On or about September 21,        2017

»» Initiation of refunds: On or about September 22, 2017 
»» Credit of Equity Shares to demat accounts: On or about                  September 22, 2017
»»  Commencement of trading of the Equity Shares on the Stock         Exchanges: On or about September 25, 2017
»» Listing At: BSE, NSE

Company Profile & Background

Capacit’e Infraprojects is a fast growing construction company focussed on Residential, Commercial and Institutional buildings, with growth in consolidated revenue from operations from INR2,142.59 million for Fiscal 2014 to INR8,532.90 million for Fiscal 2016 and an Order Book of INR40,490 million as at January 31, 2017 comprising 51 ongoing projects.

The company predominantly operates in the Mumbai metropolitan region (“MMR”), the National Capital Region (“NCR”) and Bengaluru. Its operations are geographically divided into MMR and Pune (“West Zone”), NCR and Patna (“North Zone”) and Bengaluru, Chennai, Hyderabad and Kochi (“South Zone”). As on January 31, 2017, projects in the West Zone, North Zone and South Zone constituted, approximately 60.78%, 15.69% and 23.53% of its total projects, respectively.

Capacit’e Infraprojects works for a number of reputed clients and is associated with some marquee construction projects in India. Some of its clients include Kalpataru, Oberoi Constructions Limited, The Wadhwa Group, Saifee Burhani Upliftment Trust, Lodha Group, Rustomjee, Godrej Properties Limited and Prestige Estates Projects Limited.

Company Promoters:

Mr. Rohit R. Katyal, Mr. Rahul R. Katyal, Mr. Subir Malhotra and are the Promoters of the Company.

Mr. Rohit R. Katyal, 46, is the Executive Director and Chief Financial Officer of the Company. Mr. Rahul R. Katyal, 42, is the Managing Director of the Company. Mr. Subir Malhotra, 51, is the Executive Director of the Company.

Competitive Strengths

Focus on construction of high rise buildings in major cities
Large Order Book with marquee client base and repeat orders (51 ongoing projects)
Capabilities to undertake building construction projects using modern technologies needed for high rise buildings.
Owns equipment that is required for design and development.

Objects of the Issue

The company will utilise net proceeds of the issue for funding working capital requirements (Rs 250 crore); funding purchase of capital assets (system formwork) (Rs 51.95 crore); and general corporate purposes.

Financials

Company’s consolidated revenue from operations increased sharply from Rs 214.26 crore in FY14 to Rs 1,157 crore in FY17.

Capacit’e has outstanding borrowings of Rs 316.34 crore as of May 2017.

Projects

As of May 2017, company has total order book of Rs 4,602.48 crore under residential, commercial and institutional segments.

Dividend Policy

In the last four fiscal years (being a period since the incorporation of the company), Capacit’e Infraprojects paid an interim dividend of Rs 2 per share in the year ended March 2016 and Rs 0.5 per share in FY17.

 

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