Subscribe to IL&FS Trans IPO for listing gains: ICICIdirect

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ICICIdirect.com has come out with a research note on IL&FS Transportation Network's (ITNL) IPO. The broking firm has recommended investors subscribe to the issue for listing gains.

ITNL will raise upto Rs 700 crore through its IPO, which will close on March 15. The price band is at Rs 242-258 per share.

The report says, "Incorporated in 2000, ITNL is one of the largest private sector BOT road operators in India. The company currently has a portfolio of 17 transportation projects aggregating 9397 lane km (4086 lane km operation and 5300 lane km under development). Given the early mover advantage in this vertical, ITNL is likely to be a key beneficiary of the huge opportunities in road verticals."

"ITNL currently has eight operational projects aggregating 4086 lane km making it a bigger player than IRB infrastructure (3404 lane km operational). Additionally, ITNL is looking to develop projects aggregating 5316 lane km over the next two or three years, which is again higher than IRB (1646 lane km). ITNL, being the largest BOT road project operator, is likely to be a key beneficiary of the huge opportunities in the road vertical," according to ICICIdirect.com.

The report also says, "At the IPO price band of Rs 242-Rs 258, ITNL is available at 2.9x P/BV (post IPO BV) at the lower price band and 3.1x P/BV (post IPO BV) at the higher price band. Furthermore, EV/operational lane km works out to Rs1.95 crore, which is at a discount to its closest peer (IRB Infra). Hence, we recommend investors subscribe to the issue for listing gains."

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