Power Mech Projects to raise Rs 270 crore through IPO

Power Mech Projects plans to raise nearly Rs 270 crore through initial public offering (IPO) to meet its working capital requirements and expand presence globally.
The issue of 42,69,000 equity shares will open on August 7 and close on August 11. The company has fixed the price band at Rs 615 to Rs 640 per equity share.
"We see a huge growth opportunity in the power sector. Being a service provider, we are raising funds for meeting our working capital requirements," the company's Chairman and Managing Director S Kishore Babu told reporters here today.
The company is engaged in three business verticals, including erection, testing and commissioning of boilers, turbines and generators (ETC-BTG) and balance of plant (BOP) for power sector, operation and maintenance (O&M) and civil works which include construction jobs for the main plant and BOP requirements.

Currently, the ETC-BTG business contributes nearly 67 per cent of the total business, O&M 20 per cent while the civil works account for 13 per cent.
"In the next two years, we want to increase the share of revenues from the O&M segment to nearly 35-40 per cent. Also, we are seeing a good opportunity in MENA region, in the O&M sector.

"We are pursuing these markets closely and we expect that in this fiscal, we will be able to increase our share of revenues from global sales to 14 per cent from the current nine per cent," company's Chief Financial Officer J Satish said.

The company bagged orders worth Rs 1,960 crore in FY15, he said, adding, "we have already bagged Rs 1,000 crore worth orders so far and by the end of this fiscal, we expect to get another Rs 1,500 crore worth contracts."
The lead managers to the issue are Kotak Mahindra Capital, IIFL Holdings and Motilal Oswal Investment Advisors.