Vikran Engineering's ₹772 crore IPO opened on August 26th and will be available for subscription until August 29th. A Grey Market Premium (GMP) of 21.65% has been recorded, and ₹231.6 crore has been raised from anchor investors. Experts recommend investing for the long term, citing the company's b order book and favorable sector environment.
Vikran Engineering IPO: Infrastructure EPC company Vikran Engineering's ₹772 crore IPO opened on August 26th and will remain open for subscription until August 29th. The Grey Market Premium is recorded at approximately 21.65%, and ₹231.6 crore has already been raised from anchor investors. The company has an order book of over ₹2,000 crore, which is double the estimated earnings for FY25, and experts consider it favorable for long-term investment, especially given the government's water and power infrastructure plans.
What does the Grey Market Premium indicate?
The Grey Market Premium (GMP) indicates to investors the price at which a company's shares are trading in the unlisted market before listing. The GMP for Vikran Engineering has been recorded at 21.65 percent, although this premium may change over time. Investors can view it only as an estimate.
Company's Business and Model
Vikran Engineering operates in the EPC sector and adopts an asset-light business model. In this model, the company leases the resources required for the project, which reduces fixed costs and increases project efficiency. SBI Securities has given a 'Neutral' rating on this IPO and has advised to watch the company's performance after listing.
The company's EBITDA and PAT margins are higher than its core competitors, such as Kalpataru Projects International, KEC International, and Transrail Lighting, until FY25. This gives investors an idea of the company's profitability potential.
Company Benefits from Government Infrastructure Projects
Anand Rathi has given the Vikran Engineering IPO a 'Subscribe for Long Term' rating. The company's expansion potential, b order book, and favorable sector environment are the main reasons behind this. The company has an order book of over ₹2,000 crore, which is double the estimated earnings for FY25. This makes the company's growth prospects look b over the next two years. The government's emphasis on water cycling and power infrastructure is likely to increase the company's chances of benefiting from future tenders.
Participation of Anchor Investors
Prior to the IPO launch, Vikran Engineering raised ₹231.6 crore from anchor investors. Key investors such as Bank of India Mutual Fund, ITI MF, Samco MF, SBI General Insurance, IMAP India, Bengal Finance and Investment, VPK Global, and Societe Generale participated in this anchor portion. This reflects the trust and confidence in the company among investors.
Company's Strength in the EPC Sector
Investors investing in the Vikran Engineering IPO can become part of the company's expansion and future growth. The company's strength in the EPC sector and project delivery capabilities set it apart from other competitors. Investors should make decisions during the IPO, keeping in mind the Grey Market Premium, the participation of anchor investors, and the company's financial strength.
