Annu Projects makes weak D-St debut, lists at 27% discount on NSE

Annu Projects shares made a very weak debut on the exchanges on Wednesday as they listed at a discount of 27 per cent, much lower than the grey market expectations.

 

Annu Projects shares listed at ₹75 on the BSE, a discount of 24.24 per cent against the offer price of ₹99. Meanwhile, on the National Stock Exchange (NSE), it debuted at ₹72, down 27.27 per cent.

 

Ahead of the debut,  Annu Projects IPO had a discounted grey market premium (GMP), meaning that its shares are trading at ₹92, a discount of ₹7 on the offer price of ₹99. 

Shivani Nyati, head of wealth at Swastika Investmart, said that Annu Projects made a weak debut, listing at ₹72 on NSE. However, the post-listing valuation looks reasonable at 19.6 times P/E, below peers like EMS (24.6 times) and Likhitha Infrastructure (23.2 times).

 

 

She added that the company has a strong ₹938.65 crore order book and ₹1,959 crore visibility from ongoing projects. Profitability is also healthy, with 21.27 per cent ROE and 20.81 per cent Ebitda margin. However, high customer concentration and weak operating cash flows due to working-capital requirements and delayed receivables remain key risks, Nyati added.

 

"Existing investors can hold with a ₹65 stop loss, while fresh investors can consider gradual buying on dips, rather than chasing the stock after listing," Nyati said

 

The offer received bids for 5.18 crore shares as against 1.76 crore shares on offer. The issue was subscribed 2.93 times.

 

The qualified institutional buyers' (QIB) portion was subscribed 1.72 times, while the non-institutional investors' (NII) category was subscribed 3.55 times. The retail individual investors' (RII) segment was subscribed 2.68 times.

 

Annu Projects IPO Details

 

Annu Projects IPO was entirely a fresh share sale, with no offer for sale (OFS) component. The issue comprised a fresh issue of up to 17,683,000 equity shares of ₹10 face value.

 

Of the net proceeds, the company intends to use ₹15.408 crore towards funding capital expenditure requirements of the company for purchase of machinery or equipment; ₹115 crore towards funding working capital requirements of the company; and balance towards general corporate purposes.

 

Annu Projects IPO price band was fixed at ₹94 to ₹99 per share. Investors could apply for the offer in lots of 151 shares. 

 

In the offer, 10 per cent of the portion is reserved for qualified institutional buyers (QIBs), 50 per cent for retail investors and 40 per cent for non-institutional investors (NIIs).

 

Annu Projects, established in 2003, is engaged in the design, development, implementation, operations and maintenance of essential overhead and underground utilities infrastructure across telecom, sewerage, gas pipeline and railway signaling verticals.

 

In the telecom infrastructure vertical, it is primarily engaged in surveying, designing, and installing cabling and tower infrastructure for communication, automation, and electronic security systems.