DMR HydroEngineering & Infrastructure Limited engaged in the business of providing engineering consultancy and due diligence services to hydropower, dams, roads and railway tunnels. The services offered by the Company include entire life cycle of projects covering design & engineering, due diligence & regulatory, bid management & construction engineering and quality & inspection. Company offers Hydro Engineering and Infrastructure services viz., Strategic Advisory, Due Diligence Studies, Project Viability Analysis, Cost Benefit Analysis, Risk Analysis, Regulatory Approvals, Monitoring and Evaluation, Geological Studies, Hydrological Studies, Hydraulic Studies, Hydraulic Design of Structures, Geotechnical Design of Surface and Underground Structures, Structural Design and Analysis, Dynamic Analysis, Numerical Analysis, Instrumentation Analysis, Detailed Design and Drawings, Bid level Designs and Drawings, Detailed Project Report, Feasibility Report, Layout Studies and Alternatives Analysis, Design Review, As Built Drawings, Bid documents, Bill of Quantities, Construction Planning and Scheduling, Construction Management and Method Statements, Design and Engineering Support During Construction, Rate Analysis and Cost Estimates, Contract Management, Procurement Management, Project Management, Project Commissioning, Completion Report, QA/QC plans, Quality Assurance at Site, Pre-Dispatch Inspection, Third Party Inspection, Safety Inspection and O & M stage Inspection. The Company has a presence across 11 states and internationally, Company Provide services to over 5 countries including Nepal, Nigeria, Dubai, Germany and Senegal. For the financial years ending 2021, 2020 and 2019, the revenue from exports contributed 29.31%, 33.80% and 9.52% respectively of the revenue from operations. On the financial performance front, DMR turnover/net profits (loss) of Rs. 1.60 Cr. / 3.02 Cr. (FY19), Rs. 2.44 Cr. / 5.15 Cr. (FY20), Rs. 2.44 Cr. / 6.05 Cr. (FY21). So company has shown growth. For the last three years, company has posted average EPS of Rs. 1.79 and RoNW of 19.51%. The issue is priced at a P/BV of 1.71 based on its NAVs of Rs. 12.26 post issue. As per FY21 earnings, on fully diluted equity post issue, IPO is priced at P/E of around 13, and as per FY22 annualised earnings, P/E is around 10, which looks Reasonably priced. Comparison between listed peers in shown above table, but it can't be compared apple to apple basic. On BRLM's front, Sherni shares private limited associated with this SME IPO and handled 6 IPOs in last 3 years. From last 6 IPOs, two opened below issue price and remaining above issue price or at par. As of now from 6 IPOs, one are trading below and remaining is trading above issue price or at par As on (22.11.21 ) For DMR Limited financials are good, RoNW is 19.81% and P/E is around 13 for FY21 earnings. So issue looks reasonably priced, but this segment is highly competitive and it looks very difficult if company can maintain same margin in future. Performance of BRLM is average. So we give AVOID rating to this SME IPO.
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