It is a Power plant-erection and Maintenance Company based out of Hyderabad and was founded in 2009. The company, backed in portion by Motilal Oswal’s private equity arm, is offering 42.69 lakh shares of Rs 10 each for its initial public offering, which will be open from August 7 and 11.
The firm has fixed the price band from Rs 615-640 for each equity share. The issue, which will be through the book building process, is for Rs 262-273 crore, at the lower and upper levels of the price band respectively. The minimum bid lot is 20 equity shares and in multiples of 20 thereafter. The equity shares will be listed on the NSE and the BSE. So a retail investor can apply to a maximum of 300 shares worth Rs 1,92,500.
Of the shares on offer, 21.28 lakh shares are fresh equity offering while 21.41 lakh shares are an offer for sale by selling shareholder Motilal Oswal Private Equity. The issue will constitute 29.02 per cent of the fully diluted post issue paid-up equity share capital of the company. The firm will use the proceeds to fund its working capital requirements and for general corporate purposes.
Hyderabad-based Power Mech Projects Ltd’s primary business is erection, testing and commissioning of boilers, turbines and generators at power plants as well as operations and maintenance (O&M) of power projects.
Of the O&M business, Power Mech says it controls 70 per cent of the market share and counts India’s biggest private sector power producers, including the large power projects by Tata Power and Adani Power, as among its clients.
The firm’s revenues have grown at a compounded growth rate of 29% from Rs. 491.6 crore in financial year 2011 to Rs.1,361.6 crore in 2015, while its net profit increased from Rs.37.6 crore in 2011 to Rs.71.4 crore in 2015. Based on this, the EPS for this is around Rs 56 and P/E works at around 11.5.
As of June, the order book for Power Mech is worth Rs 3400 crore, most of them from India.
The book running lead managers to the Issue are Kotak Mahindra Capital, IIFL Holdings Ltd and Motilal Oswal Investment Advisors. The registrar to the issue is Karvy Computershare.
The allotment status is not available right now but once available you can find allotment status of Power Mech IPO here.
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