Wednesday, February 3, 2010

ARSS Infra IPO - Analysis, Subscription, Allotment and Listing

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Orissa based infrastructure company, ARSS Infrastructure Projects has come out with an initial public offering (IPO) of Rs 103 crore. The company is engaged in the business of construction activities in India. It undertakes construction of railway infrastructure, roads, highways, bridges and irrigation projects.

The issue will open for subscription between February 8 and 11, 2010. The company has the fixed price band at Rs 410-450 per share. .

The proceeds of the issue are intended to be deployed for investment in joint ventures (at a cost of Rs 5 crore) and funding long term working capital requirement (cost of Rs 86 crore). The rest of amount will be used for issue expenses and general corporate purpose.

For the year ended March 31, 2009, the company has reported profit after tax of Rs 51.19 crore on total income of Rs 628.23 crore. As of June 2009, it has debt of nearly Rs 240 crore. The company's order book position was at Rs 28.77 billion as on January 10, 2010 and it had 145 projects in hand as on that date. Its clients' list includes Ministry of Railways, State Government of Orissa, Rail Vikas Nigam Limited, RITES Limited, IRCON International Limited, National Thermal Power Corporation, Hindustan Steel Corporation Limited, PWD – Orissa, IOCL and the National Highway Authority of India. The company has presence in Eastern India, particularly in the state of Orissa.

The book running lead managers to the issue are IDBI Capital Market Services Ltd and SBI Capital Markets Ltd. Bigshare Services Private Ltd is the registrar.

CARE has assigned Grade 2/5 to the IPO, indicating less than average fundamentals.

The IPO got great response from investors and got subscribed over 47 times at the close.

At the close of the IPO,
QII segment was subscribed by 49.3 times
NII segment was subscribed by 124.5 times
Retail segment was subscribed by 18.55 times

Click here to check if you have been alloted ARSS Infra shares!

ARSS Infra gave bumper returns to investors on the listing day! Against the issue price of Rs. 450, the share opened at Rs. 630, which was also the low of the day. It went to a high of Rs 751 before closing the day at Rs. 737, a premium of over 63%.

Watch out this blog for all the details on subscription, allotment and listing!
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