The Hindu Business Line : MBL Infra public issue assigned Crisil IPO grade of "1/5"

Mumbai April 14 CRISIL has assigned a CRISIL IPO grade of "1/5" to the proposed initial public offer of MBL Infrastructures Ltd (MBL) indicating that the fundamentals of the issue are poor relative to other listed equity securities.

The company has proposed a public issue of 60 lakh equity shares at a target price of Rs 100 per share aggregating Rs 60 crore.

The assigned grade reflects MBL's weak competitive position in the road construction industry, especially the Build Operate and Transfer (BOT) segment; also the company's management has been a late mover in capturing business opportunities in its area of operations; and the returns from the company's planned large investment in the BOT segment would be subject to a lead time of 4-5 years.

The grading takes into account the company's good track record in the road maintenance business segment, which would benefit from the current boom in the road construction industry.

However, CRISIL notes MBL's fund requirement for the construction, contracting and road maintenance parts of its business is much lower than what the company is planning to raise from the market.

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MBL Infra public issue assigned Crisil IPO grade of "1/5"