Garuda Construction and Engineering IPO Opens on October 8: ₹92-95 per Share

Garuda Construction and Engineering Ltd, a civil construction company offering end-to-end services for residential, commercial, and infrastructure projects, will open its Initial Public Offering (IPO) for subscription on October 8, 2024, and close it on October 10, 2024. The company has set the price band between ₹92 and ₹95 per equity share, with a minimum bid size of 157 equity shares per lot.

IPO Structure and Fund Utilization

The IPO aims to raise ₹264.10 crore, comprising a fresh issue of up to 1.83 crore equity shares (₹173.85 crore) and an offer for sale (OFS) of up to 95 lakh equity shares (₹90.25 crore). Proceeds from the fresh issue will be used to meet the company’s working capital requirements (₹100 crore) and for general corporate purposes, which may include potential inorganic acquisitions.

The IPO is structured through the book-building process, with 50% of the offer reserved for Qualified Institutional Buyers (QIBs), 15% for Non-Institutional Investors (NIIs), and 35% for Retail Individual Investors (RIIs).

Company Background and Services

Garuda Construction and Engineering specializes in a wide range of civil construction services, including residential, commercial, and industrial projects. The company also handles infrastructure projects and provides additional services such as:

• Operations and Maintenance (O&M) services
• Mechanical, Electrical, and Plumbing (MEP) services
• Finishing works as part of its comprehensive construction offerings

Garuda Construction has also ventured into hospitality projects, further diversifying its portfolio.

Financial Performance

The company has demonstrated strong financial growth in recent years. Its revenue from operations grew from ₹77 crore in FY2022 to ₹154 crore in FY2024, reflecting a compound annual growth rate (CAGR) of 26.03%. Meanwhile, the profit after tax increased from ₹18.78 crore in FY2022 to ₹36 crore in FY2024, with a CAGR of 24.72%. For the month ended April 2024, the company's revenue stood at ₹11.87 crore, with a profit after tax of ₹3.50 crore.

IPO Timelines and Allotment

The allotment of shares for Garuda Construction and Engineering’s IPO is expected to be finalized on October 11, 2024. The company’s shares are expected to be listed on the BSE and NSE on October 15, 2024, subject to regulatory approvals.

Despite the upcoming IPO, the grey market premium (GMP) for Garuda’s shares remains nil as of now. However, investors should note that GMPs are not always indicative of future stock performance, as they can change rapidly.

ALSO READ| Swiggy Receives Shareholder Nod to Upsize IPO Fresh Issue to $1.4 Billion

Garuda Construction and Engineering's IPO offers investors a chance to invest in a growing company within India’s booming construction and infrastructure sector. With strong financial growth and a diverse range of services, the company is well-positioned for future expansion. The proceeds from the IPO will be used to bolster working capital and support corporate activities, including potential acquisitions that could further strengthen Garuda's market position.

[Disclaimer: This blog post is for informational purposes only. Investors should conduct their own research and consult financial advisors before making investment decisions.]