Vishnu Prakash R Punglia stock slips on profit taking after a stellar debut

• Vishnu Prakash R Punglia stock listed at ₹160 as compared to its IPO price of ₹99.
• The net proceeds will be used to purchase capital equipment, fund working capital needs and for general corporate purposes.
• The company is an integrated EPC company, which specializes in water supply projects.

Vishnu Prakash R Punglia stock made its D-Street debut on Tuesday with 65% premium – listing at ₹163 as compared to its IPO price of ₹99. After meeting grey market expectations which was hoping for 60% listing gains, the stock fell 10% from its debut price during the day’s trade.

At the close of day's trade the stock fell to ₹145.70, a gain of 47% from the IPO price. Market watchers attributed the slip to profit taking by investors.

The market cap of the company was at ₹1,994 crore, as per Bombay Stock Exchange.

Its public issue was subscribed 87.82 times on the last day of the issue. The issue saw aggressive bidding from institutional investors with Qualified Institutional Buyers (QIB) and non-institutional investor portions were subscribed over 100 times.

The IPO raised ₹308.88 crore with a complete fresh issue of 31.2 million shares, without an offer-for-sale component.

Listing gains from the last five market debuts

While the market has seen a flurry of IPOs, the listing gains that they provided have been varied, with a few surprises and a few disappointments.


About the company

The company owns a fleet of about 484 construction equipment assets like crushers, excavators, loaders, dozers, paver machines, ready mix concrete plants, concrete mixtures, cranes, tractors and transportation vehicles.

Its major activities include constructing, designing, building, implementing, operating, maintaining and developing water supply projects including water treatment plants along with pumping stations and laying of pipelines for supply of water.

It also takes up other projects such as roads, bridges, tunnels, warehouses, buildings, railway buildings including platforms, stations, quarters, administrative buildings, rail-over-bridges and wastewater treatment plants. It also undertakes operations and maintenance services.

The company’s revenue from operations has been growing at a compounded annual growth rate (CAGR) of 55%. As on July 15, 2023, it has an order book of ₹3,799.53 crore.

Most of the company’s business is concentrated in Rajasthan, and orders in the state constitute 61.5% of its order book — which can be risky as any adverse impact in the region can impact its business and financial condition.

A significant portion of its revenues, around 83% from its top five clients, and their loss can have an adverse effect on its business. Its projects are exposed to various implementation and other risks, including risks of time and cost overruns, and uncertainties.

Its promoters, promoter group and third parties mortgaged their personal properties and provided personal and/or corporate guarantees for the company’s borrowings to secure our credit facilities. Its business can be adversely affected if these guarantees are revoked by them.