Manav infra projects Ltd

Started in 2009, Manav infra projects Ltd is engaged into the business of civil construction services such as piling, excavation, road construction, land leveling. They also provide a complete range of earth moving machines and construction equipments on rent for all type of infrastructure and construction related work. Company's customer include medium to large size of construction and infrastructure companies like Kanakia Spaces Realty Pvt Ltd, J Kumar Infra Projects Ltd, ACC Ltd, J P Infra Constructions, Simplex Infrastructure Ltd, Man Infra Constructions Ltd and Nirmal Lifestyle Limited. They have advances machines built by top class international brands like Caterpillar(CAT), Volvo, Kobelco, Tata Hitachi, JCB, Furukawa, Ashok Leyland, Komatsu and more. On performance front, for last four fiscals, MIPL has posted turnover/net profits of Rs. 11.97 cr./ Rs. 0.21 cr. (FY14), Rs. 16.23 cr. / Rs. 0.004 cr. (FY15), Rs. 16.44 cr. / Rs, 0.61 cr. (FY16) and Rs. 18.30 cr. / Rs. 1.03 cr. (FY17). It suffered a setback for FY15 despite higher other income. Sudden jump in bottom-line for FY16 and FY17 is due to deferred tax provisions. Last three fiscals average EPS of Rs. 3.60 and average RoNW of 15.29% is based on a paid up capital of Rs. 2 crore. If we attribute latest earnings on fully diluted equity post issue then asking price is at a P/E of 20 plus. Peers are trading around 20 to 23 P/E. Thus issue appears to be fully priced. As per financials, company's growth is normal, RoNW is 15.29% for last three fiscals and issue is fully priced. There is setback in bottom line in FY 15, So we give NEUTRAL rating to this SME IPO.

• 1 Mr. Mahendra Narayan Raju