Here’s some good news for IPO investors! A wastewater and sewage treatment company – EMS Limited – plans to raise Rs. 321.24 crores through its IPO, which opens for public subscription on 6 September 2023. The IPO already demands a robust grey market premium (GMP) as per the initial indications. Keep reading to know the details of the EMS Limited IPO and decide whether to invest in it.
EMS Limited, formerly known as EMS Infracon, provides wastewater and sewage collection, treatment, and disposal services for government authorities and municipal bodies. The company's service portfolio includes water supply systems, sewerage solutions, water and waste treatment plans, electrical transmission and distribution, road and allied works, water supply projects, and wastewater scheme projects.
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The company has a civil construction team with more than 57 engineers. As of July 2023, the company had 18 ongoing projects with a total order book of Rs. 1,775 crores. These projects included WWSPs, WSSPs, STPs, and HAMs.
Reading a company’s financials before investing in its IPO is crucial.
|Particulars||As of and for FY Ending March 31|
|Revenue From Operations||538||360||331|
|Profit After Tax||109||79||72|
|Earnings Per Share (Diluted)||23||67||61|
|Net Asset Value (In Rs/share)||104||324||257|
|Return on Net Worth||22%||21%||24%|
|Return on Capital Employed||28%||30%||34%|
*Amount in Crores
A few takeaways from the financials of EMS Ltd. as seen in the table above include:
The share capital is robust only for the latest financial year. It was flat for the two preceding years.
The company's net worth has expanded by more than 150% from Rs. 302 crores in FY21 to Rs. 488 crores in FY23.
The revenue and profit have also grown equally in the last two financial years.
The total borrowings have increased suddenly from Rs. 4 crores to Rs. 45 crores in the latest financial year.
The profitability and earning ratios are pretty impressive.
|IPO Date||8 Sept to 12 Sept 2023|
|Face Value||Rs 10 per share|
|Price Band||Rs 200 to Rs 211 per share|
|Lot Size||70 shares|
|Total Issue Size||Rs 321.24 crores|
|Fresh Issue||Rs 146.24 Cr|
|Offer for Sale||Rs 175.00 Cr|
|Issue Type||Book-built IPO|
Considering the company's steady growth and attractive valuation, subscribing to the EMS Limited IPO isn’t a bad idea. The company has several factors in its favor than the ones against it. As per the current grey market trends, the shares can list at a premium of around 50%. If you are open to moderate risks, you can stay invested long-term.
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