Garuda Construction and Engineering IPO Opens Tomorrow: Here’s What You Need to Know

The Garuda Construction and Engineering IPO is set to open for subscription tomorrow, October 8. Garuda Construction and Engineering Ltd offers a wide range of civil construction services for various projects, including residential, commercial, infrastructure, and hospitality. The company aims to improve its capacity for handling civil construction projects across different sectors and seeks to secure larger contracts with developers outside their group entities to expand its client base.

In the fiscal year 2022, Garuda’s revenue from operations was ₹7,702.08 lakhs. By fiscal year 2024, this figure increased to ₹15,417.83 lakhs, reflecting a Compound Annual Growth Rate (CAGR) of 26.03%. Additionally, the company’s profit after tax grew from ₹1,878.22 lakhs in fiscal 2022 to ₹3,643.53 lakhs in fiscal 2024, demonstrating a CAGR of 24.72%.

ADVERTISEMENT

Garuda’s listed competitors include:

• PSP Projects Ltd: P/E of 20
• Capacite Infraprojects Ltd: P/E of 23.61
• Vascon Engineers Ltd: P/E of 22.66
• Ahluwalia Contracts (India) Ltd: P/E of 22.97
• B L Kashyap & Sons Ltd: P/E of 48.67

According to a CareEdge Report, Garuda Construction and Engineering has the highest operating profit margin among its peers, with a margin of 34.80% in FY23, significantly higher than the average of 16.90% in the same period.

Here are the 10 key details about the Garuda Construction IPO:

1. IPO Dates: The Garuda Construction and Engineering IPO opens for subscription on Tuesday, October 8, and closes on Thursday, October 10.
2. Price Band: The price band for the issue is set between ₹92 and ₹95 per equity share with a face value of ₹5.
3. Lot Size: The lot size for the IPO is 157 equity shares, and additional shares can be purchased in multiples of 157.
4. Anchor Investors: The allocation for anchor investors will take place today, Monday, October 7.
5. IPO Details: The IPO consists of 1.83 crore fresh equity shares and 95 lakh equity shares being offered for sale by the promoter PKH Ventures Ltd.
6. Use of Proceeds: The funds raised from the fresh issue will be used for operational funding requirements and general business purposes, including potential acquisitions.
7. Listing Date and Allotment: The allotment of shares is expected to be finalized on Friday, October 11. Refunds will be processed on Monday, October 14, and shares will be credited to the demat accounts of allottees the same day. The shares are expected to be listed on the BSE and NSE on Tuesday, October 15.
8. Lead Manager and Registrar: Corpwis Advisors Private Ltd is the sole lead manager for the issue, while Link Intime India Private Ltd will act as the registrar.
9. Share Reservation: The company has reserved 50% of the shares for qualified institutional buyers (QIB), 15% for non-institutional investors (NII), and 35% for retail investors.
10. Grey Market Premium (GMP): The Garuda Construction IPO GMP today is +22, indicating that the shares were trading at a premium of ₹22 in the grey market. This suggests that the estimated listing price could be around ₹117, which is 23.16% higher than the upper end of the IPO price band at ₹95. The GMP has shown an upward trend over the past week, signaling a strong potential listing based on current market activities.

The term ‘grey market premium’ reflects investors’ willingness to pay more than the issue price.