Friday, October 1, 2010

BS TransComm IPO - Analysis, Recommendation, Subscription, Allotment, Listing

Analysis:
BS TransComm, an engineering and capital goods company has come out with an IPO of 76.79 lakh shares. The company is based out of Hyderabad and has interests in Telecom, Power and Alternate Energy sectors. With a pan-India service network, the group has positioned itself as a leading managed managed services provider for telecom infra companies. The company has a manufacturing capacity of 1,20,000 MTPA with a backward integrated structural steel plant supporting the raw material required for tower manufacturing. It is currently undertaking a project to expand the manufacturing capacity to 240,000 MTPA.

The IPO will open on October 6 and will close on October 8, 2010. The company has fixed the price band of Rs 257 - 266 per share. The shares are expected to be listed on BSE and NSE. Due to poor response from investors, the closing date will be extended till October 13 and the price has been revised to Rs 247 - 257.

Issues proceeds are proposed to be used for setting up of manufacturing facilities of telecommunication and power transmission towers under Phase I and Phase II at Majidpally Village, Medak, Andhra Pradesh having an installed capacity of 84,000 MTA and 120,000 MTA respectively; setting up rolling mill plant at Majidpally Village, Medak, Andhra Pradesh under Phase I having an installed capacity of 90,000 MTA; financing margin money for working capital; and for general corporate purposes.

The lead financial manager is JM Financial Consultants Pvt Ltd and registrar is Karvy Computershare Pvt Ltd.

Recommendation:
ICRA has assigned Grade 2 to the IPO. The IPO looks expensive at current levels. We would not recommend this IPO to investors at this time. There may be some listing gains but not worth the risk.

Subscription:
Due to poor response from investors, the closing date will be extended till October 13 and the price has been revised to Rs 247 - 257. At the close of the day,
QII segment got subscribed 0 times
NII segment got subscribed 2.01 times
Retail segment got subscribed 0.78 times

Allotment:
Click here to check if you have been alloted BS TransComm shares!

Listing:
BS TransComm IPO got listed on 27th October. The share touched an intraday high of Rs 398.40, before closing at Rs 362, a premium of 45.97% over an issue price of Rs 248 a share on the NSE.


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