Business Daily from THE HINDU group of publications
Saturday, Jul 01, 2006
Business Daily from THE HINDU group of publications Saturday, Jul 01, 2006 |
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Markets
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IPOs Corporate - Outlook Our Bureau
Hyderabad , June 29 Indu Projects Ltd , the Hyderabad-based Rs 312-crore infrastructure development company with over Rs 6,000-crore projects currently on hand, is set to dilute 8.5 per cent of its equity to raise Rs 150 crore of funds to augment its networth. At a valuation of around Rs 1,000 crore, the company could recently raise around Rs 90 crore of funds by placing 8.9 per cent equity at Rs 900 per share, according to the Managing Director and CEO, Mr I. Syam Prasad Reddy. As the valuation has now improved to Rs 1,600 crore, the company plans to raise additional funds by placing the equity at Rs 1,300 per share. Keeping in view the request of the investors on providing them an early exit route, the company might consider tapping the capital market with its initial public offer (IPO) sometime in the next two years, Mr Reddy told newspersons here on Thursday. "However, the company will tap the market with IPO only after achieving a topline of over Rs 3,000 crore and improving its valuation substantially," Mr Reddy said. Following the recent equity dilution, the company could improve its networth to Rs 122 crore from Rs 30 crore. It expects to improve the networth to Rs 450 crore by the current fiscal-end, the IPL Director and CFO, Mr Ram Pujari, said. The company's paid-up equity would improve to around Rs 15 crore following the placement from the current level of Rs 12.35 crore. For the fiscal ended March 2006, it posted a net profit of Rs 25.79 crore on a turnover of Rs 312.21 crore as against Rs 5.55 crore of net profit on a turnover of Rs 128.49 crore in the previous fiscal.
Currently having a land bank of around 2,000 acres spread over four major States of Andhra Pradesh, Karnataka, Tamil Nadu and Maharashtra, the company is embarking upon projects worth Rs 15,000 crore to be completed over the next five years. The company, which had entered into several consortia with other leading companies, could bag a number of projects relating to realty involving development of townships, IT SEZs and commercial space during the last fiscal. These projects would be executed through special purpose vehicles (SPVs) in which the company holds majority holding, Mr Reddy said. Following the recommendations of the consultancy major Ernst & Young on business restructuring, the company formed four separate strategic business units - construction, realty, realty infrastructure and BOT & special projects. Each of these SBUs would be operationally independent and responsible for building and nurturing the relative business and achieving a healthy growth in bottomline.
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