Gayatri Projects IPO opens on Sept 26

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The Hyderabad-based Gayatri Projects is entering the capital market with an IPO of 29,00,000 equity shares of Rs 10 each for cash, at a premium to be decided through the book-building process, reports The Hindu Business Line.

The price-band for the issue has been fixed between Rs 275 and Rs 295. It opens for subscription/bids on September 26 and closes on September 29, 2006, said the company's managing director, T V Sandeep Kumar Reddy, here on Monday.

Offer for sale

Addressing a press conference, he said the issue comprises an offer for sale of 19,00,000 equity shares and a fresh issue of 10,00,000 equity shares. The offer for sale is being made by Videocon Appliances and Videocon Industries, existing shareholders.

The company also proposes to reserve 1,00,000 equity shares for allotment to eligible employees. The offer constitutes 29% of the post issue paid-up capital of the company.

He said the money raised from the issue will be invested in a special purpose vehicle, SPV for execution of the Meerut-Muzaffnagar NHAI BOT/BOOT project and for repayment of debt.

Major civil works

Of the net offer to public, 50% is to be reserved for allotment on a proportionate basis to qualified institutional investors. Of this, five per cent will be allotted to mutual funds only. Further, 15% will be reserved for allotment on a proportionate basis to non-institutional bidders and the balance 35% will be reserved for allotment to retail investors.

The 1989-incorporated company, with a turnover of Rs 370 crore (Rs 3.70 billion), is engaged in execution of major civil works, including roads and highways, irrigation canals, concrete and masonry dams and ports, among other things, for the last 16 years.

Its construction works include 644 km of highways, 1,113 km of irrigation canals, apart from the 50.60 km of Narmada Main Canal in Gujarat. The company, having more than 850 employees, has a net worth of Rs 92 crore (Rs 920 million) and order book worth Rs 2,400 crore (Rs 24 billion).