Vishnu Prakash R Punglia Limited is an ISO 9001:2015 certified integrated engineering, procurement and construction ('EPC') company with experience in design and construction of various infrastructure projects for the Central and State Government, autonomous bodies, and private bodies across 9 States and 1 Union territory in India. The principal business operations are broadly divided into four categories: (i) Water SupplyProjects ('WSP') (ii) Railway Projects (iii) Road Projects and (iv) Irrigation Network Projects. Company undertakes projects on EPC basis, with or without operation and maintenance services ('O&M'). The scope of the services includes detailed engineering of the project, procurement of key materials, and project execution at the sites with overall project management up to the commissioning of these projects. In addition, they also undertake operation and maintenance of projects in accordance with the contractual arrangements. As on July 15, 2023, they have fifty-one (51) on-going projects with total work awarded amounting to Rs 61,835.81 million, of which Rs 23,840.53 million worth of work has been executed and the remaining work amounting to Rs 37,995.28 million constitutes the Order Book. Out of the fifty-one (51) on-going projects, they are executing thirty-nine (39) projects independently while for the remaining projects they have entered into joint venture arrangements with other infrastructure and construction entities. The revenue from operations increased from Rs 4,857.31 million in FY 2020-21 to Rs 11,684.04 million in FY 2022-23 at a Compounded Annual Growth Rate ('CAGR') of 55.10%, while the profit for the year increased from Rs 189.82 million in FY 2020-21 to Rs 906.43 million in FY2022-23 at a CAGR of 118.52%. As per financial performance, Vishnu Prakash R Punglia Limited has posted total income / net profits of Rs 487.38 Cr / Rs 18.98 Cr (FY21) and Rs 787.38 Cr / Rs 44.84 (FY22) and Rs 1,171.46 Cr / Rs 90.64 Cr (FY23). So as per previous financials data, company has shown good growth. Company has an average EPS of Rs 7.35 and average RoNW of 33.18% for last three fiscals. Issue is priced at a P/BV of 2.74 as per NAV of 36.11 as on 31.3.23. If we attribute latest earnings of FY22 on fully diluted equity post issue, then asking price is at a P/E of around 27.52 and as per FY23 earnings P/E is around 13.61, which looks fully priced. As per RHP, peers comparison is shown in above table. On BRLM's front, two lead managers are associated with this IPO, and have handled around 5 IPOs in last three fiscals.Choice Capital Advisors Private Limited : This is 1st IPO from this BRLM. (As on 21.08.2023) Pantomath Capital Advisors Private Limited : This is 6th IPO from this BRLM. From last 5 IPOs, all opened above issue price or at par on the day of listing. As of now, from last 5 IPOs, 1 is trading below issue price and remaining are trading above issue price or at par. (As on 21.08.2023) As per financials, Vishnu Prakash R Punglia Limited has shown good growth, RoNW is 38.31% and P/E is respectively 27.52 and 13.61 as per FY22 and FY23 earnings, which looks fully priced. Current order book value is around Rs 3800/- Cr. Company is in EPC business of design and construction of various infrastructure projects for the Central and State Government, autonomous bodies, and private bodies, which is highly fragmented and competitive. But we may see good growth in this sector as GoI and State Governments are focused for infrastructure development in India. Performance of BRLM is good. So, we give SUBSCRIBE rating for this IPO for listing gains. Readers must consult a qualified financial advisor prior to making any actual investment decisions.
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