VVIP Infratech Limited

VVIP Infratech Limited is a infrastructure company in Bharat. They are Class 'A' Civil and Electrical contractor having over two decades of experience in the field of execution and construction of infrastructure projects such as Sewer, Sewer Treatment Plants, Water Tanks, Water Treatment Plants, Sector Development work, Electrical Distribution and Sub Stations upto 33 kVA, Jal Jeewan Mission work etc. They are primarily working on projects in the state of Uttar Pradesh, Uttarakhand, NCR Delhi and other northern Part of Bharat. It is well-positioned to play key role in the development of India's infrastructure sector, particularly in the area of STPs. Currently, the Company has an order book of Rs. 477.62 Crores, including an Operation and Maintenance (O&M) order book of 126.19 Crores as on January 31, 2024.  The Company owns 90.02% shareholding in its Subsidiary Company namely 'Vibhor Vaibhav Infrahome Private Limited' (VVIHPL). The Subsidiary company was incorporated in 2007 and is the real estate arm of the group. As per financial performance, VVIP Infratech Limited has posted total income / net profits of Rs 185.26 Cr / Rs 4.52 Cr (FY22), Rs 210.56 Cr / Rs 13.57 Cr (FY23), Rs 285.88 Cr / Rs 20.71 Cr (FY24). So as per previous financials data, company has shown good growth, but sudden jump in net-profit before IPO is very surprising. Company has posted an average EPS of Rs 53.20 and average RoNW of 18.73% for last three fiscals. Issue is priced at a P/BV of 0.87 as per NAV of 107.22 as on 31.03.24. If we attribute latest earnings of FY22, FY23 and FY24 on fully diluted equity post issue, then asking price is at a P/E of around 51.27, 17.10 and 11.21 respectively, which looks fully priced. As per RHP, comparison between listed peers is shown in above table. On BRLM's front, Share India Capital Services Private Limited is associated with this SME IPO and handled 11 SME IPOs in last 3 years. From last 10 SME IPOs, all opened Above issue price or at par on the day of listing. As of now from last 10 SME IPOs, all are trading above issue price. ( As on 18.07.24 ) As per financials, VVIP Infratech Limited has shown good growth, RoNW is 18.73% and P/E is respectively 51.27, 17.10 and 11.21 as per FY22, FY23 and FY24 earnings. So, issue looks fully priced, but sudden jump in net-profit before IPO is very surprising. Company is a infrastructure company and working as Civil and Electrical contractor, which is highly fragmented and competitive business segment. Performance of BRLM is good. So, we give "SUBSCRIBE FOR LISTING GAINS" rating for this IPO. Readers must consult a qualified financial advisor prior to making any actual investment decisions.

• 1 Praveen Tyagi
• 2 Vaibhav Tyagi
• 3 Vibhor Tyagi