Capacit'e Infraprojects Limited

Started in 2012 and based in Mumbai, Capacit'e Infraprojects Limited is a fast growing construction company focussed on Residential, Commercial and Institutional buildings, with growth in consolidated revenue from operations from ? 2,142.59 million for FY 14 to ? 8,532.90 million for FY 16 and ? 8473.73 million for the nine month period ended December 31, 2016, and an Order Book of Rs 40,490.74 million as at January 31, 2017 comprising 51 ongoing projects. CIL provides end-to-end construction services for residential buildings ('Residential'), multi level car parks, corporate office buildings and buildings for commercial purposes (collectively, 'Commercial') and buildings for educational, hospitality and healthcare purposes ('Institutional'). CIL's capabilities include constructing concrete building structures as well as composite steel structures. Company also provides mechanical, electrical and plumbing ('MEP') and finishing works. The buildings that CIL constructs may be considered as (i) buildings with 40 or more floors as super high-rise buildings ('Super High Rise Building(s)') and (ii) buildings with seven or more floors as high-rise buildings ('High Rise Building(s)'). Company considers (i) a single premise or land parcel containing at least four buildings, which may include High Rise Buildings or Super High Rise Buildings as a gated community ('Gated Community')(ii) duplex houses and row houses as villaments ('Villaments') and (iii) buildings other than Super High Rise Buildings, High Rise Buildings, Gated Community and Villaments as other buildings ('Other Building(s)'). CIL 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. CIL works for a number of reputed clients and are 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. On performance front, for last four fiscals CIL has posted turnover/net profits of Rs 174.8 cr. / Rs 5.05 cr. (FY14), Rs 512.19 cr. / Rs 30.77 cr. (FY15), Rs 816.83 cr. / Rs 47.68 cr. (FY16) and Rs 1139.95 cr. / Rs 69.31 cr. (FY17). If we attribute latest earnings on fully diluted equity post issue then asking price is at a P/E of 17.86. Issue is priced at a P/BV of 3.37 and last three fiscal’s average RoNW is 30.41%. Thus issue is very reasonably priced. Its peers are trading on average P/E of 21.16. As per financials, company's growth is very good, RoNW is 30.41% for last three fiscals and issue is reasonably priced, so we give RECOMMENDED rating to this IPO.

• 1 Mr. Rohit R. Katyal
• 2 Mr. Rahul R. Katyal
• 3 Mr. Subir Malhotra