Nirmal Bang has come out with its report on Capacit'e infraprojects , The research firm has recommended to “ Subscribe ” the IPO in its research report as on September 13, 2017
Capacite Infraprojects Ltd (CIL) is construction company mainly focused on residential, commercial and institutional building segment. CIL provide end-to-end construction services for residential, mutli-level car parks, corporate office and buildings for educational, hospitality and healthcare purposes. CIL also provides mechanical, plumbing and finishing works.Valuation and Recommendation
Over FY13- FY17 the company’s revenues have grown at a CAGR of 75% though EBIDTA has grown at a CAGR of 114%. EBIDTA margins improved from 6.8% in FY13 to nearly 13.7% in FY17 on the back of higher revenue growth and tight control over other expenses. The company has also maintained its finance charges by keeping a tight control over working capital. Net profit witnessed a growth of 170% from FY14 to FY17 at Rs. 69.4Cr during the same period. At Rs. 250 per share (Upper end of the price band), CIL is offered at 24.5x P/E on a fully post issue diluted capital based on FY17 EPS of Rs.10.2. With Real estate regulatory act being passed in majority of the states, we expect professional EPC players like Capacite to gain traction as majority of the real estate developers would focus more on the business development and marketing front. There is a big emphasis on timely delivery of construction services and more emphasis on demand for quality and durability of construction. We recommend subscribing to the issue.
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