Vishnu Prakash R Pungalia Ltd IPO: Check Issue Size, Date and Price Band | Motilal Oswal

Vishnu Prakash R Pungalia Ltd IPO: Check Issue Size, Date and Price Band


The last few months have been brilliant for IPO investors. More than 16 mainstream companies have successfully raised over Rs. 100 billion through their Initial Public Offerings (IPOs) since February 2023. The month of August also follows suit, with a slew of IPOs being launched one after the other.

An infrastructure designing and construction company – Vishnu Prakash R Punglia Limited – is poised to launch its IPO for public subscription on 24 August 2023. The company plans to raise Rs. 309 crores to fund its working capital requirements and general corporate purposes. Continue reading to know in detail about this IPO and decide if you should subscribe to it or not.

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About Vishnu Prakash R Pungalia Ltd:

Incorporated in 1986, Vishnu Prakash R Punglia Limited is in the business of designing and constructing infrastructure projects for state and central governments, autonomous bodies, and private institutions. The company’s business operations can be classified into four broad categories – Water Supply Projects (WSP), Railway Projects, Road Projects, and Irrigation Network Projects.

As of 31 March 2023, the company’s business spans nine states and one Union Territory across India. It owns a fleet of around 484 construction equipment assets, including excavators, loaders, crushers, dozers, paver machines, cranes, tractors, concrete mixtures, and transport vehicles. As of 15 July 2023, the company's total order book stood at Rs. 3,800 crores.

Strengths of Vishnu Prakash R Pungalia Ltd:

  • One of the key players handling Water Supply Projects in India
  • 36 years of experience in the infrastructure construction industry
  • Robust growth through a strong order book across segments
  • Long-term and established relationships with a diversified client base
  • An established track record of on-time completion of projects
  • Focused on geographical diversification of its business
  • Plans to work for the Indian Government’s National Infrastructure Policy (NIP)
  • Boasts a robust in-house integrated business model

Key Risks/Weaknesses Of Vishnu Prakash R Pungalia Ltd:

  • Almost two-thirds of the business is centered in Rajasthan
  • Draws a significant portion of the revenue from selected clients
  • There are certain outstanding litigations against the company
  • Exposed to various risks, such as implementation, financial uncertainties, time and cost overruns, etc.
  • Requires numerous licenses and regulatory compliances to carry out its business
  • Engaged in a capital-intensive business. Unavailability of funding at crucial junctures may adversely impact the completion of projects

Financial Snapshot of Vishnu Prakash R Pungalia Ltd:

The table below highlights the key financials of Vishnu Prakash R Punglia Ltd. for the last three financial years. All data as per the company’s Draft Red Herring Prospectus (DRHP):

*Amount in Crores

Here are a few takeaways from the financials of Vishnu Prakash R Punglia Ltd:

  • The revenue growth has been robust in the last two financial years, expanding from Rs. 486 crores in FY 2021 to Rs. 1,168 crores in FY 2023
  • The profits have doubled each time in the last two financial years
  • The return and equity for FY 2022 and FY 2023 stood at highly impressive 33% and 38% respectively
  • The company has maintained an excellent asset turnover ratio, which is essential for a capital-intensive business
Particulars As of and For FY Ending March 31
2023 2022 2021
Share Capital 93 28 28
Net Worth 315 159 114
Total Borrowings 250 177 111
Revenue From Operations 1168 786 486
EBITDA Adjusted 160 89 47
Profit After Tax 91 45 19
Earnings Per Share (Diluted) 10 5 2
Net Asset Value (In Rs/share) 36 19 13
Return on Equity 38% 33% 18%
 Return on Capital Employed 34% 30% 19%

Details of the IPO:

The Vishnu Prakash R Punglia IPO opens for public bidding on Thursday, 24 August 2023, and closes on Monday, 28 August 2023. As an investor, you can bid for a minimum of 150 shares (one lot) and in multiples thereof in the price band of Rs. 94 to Rs. 99 per share. The IPO comprises an entirely fresh issue of up to 3.12 crore equity shares without an offer-for-sale (OFS) component.

With the money raised, the company plans to:

  • Fund capital expenditure requirements for purchasing new machines/equipment
  • Meet working capital requirements
  • Fulfil general corporate purposes

50% of the offer will be reserved for Qualified Institutional Buyers (QIBs), 15% for Non-Institutional Buyers (NIBs), and 35% for retail investors. Refer to the table below for more details:

IPO Date 24 Aug to 28 Aug 2023
Listing Date 05-Sep-23
Face Value Rs. 10 per share
Price Band Rs. 94 to Rs. 99 per share
Lot Size 150 shares
Total Issue Size 31,200,000 shares (aggregating up to Rs. 308.88 crores)
Fresh Issue 31,200,000 shares
Employee Discount Rs. 9 per share
Issue Type Book-built IPO
Listing At NSE, BSE

The final verdict

Considering the impressive valuation, strong order book, and profit-churning ability of the company, it makes sense to ‘subscribe’ to the Vishnu Prakash R Punglia Limited IPO. The current Grey Market Premium (GMP) also reflects a strong listing on the bourses. 

If you want a Demat account to invest in this IPO, you can open it for free with Motilal Oswal.


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