According to Nilesh Shah, MD & CEO of Envision Capital it was a pretty attractive proposition given EIL's pedigree. "It's strong positioning within the niche segment that it is in, the margin profile that it has, the balance sheet profile it has, the fact that it is a zero debt company, which has strong cash in its balance sheet and it is kind of a close to a monopoly kind of a situation which it enjoys and the fact that it offers higher end consulting and other project related services. It is an excellent company. The valuations are not very high though of course they are not very cheap. But clearly it is an attractive opportunity, especially the price band at which it is Rs 270-290, clearly makes a lot of sense for long-term investors."
About the issue
Retail investors will get a 5% discount on the issue price, which will be discovered through the book building process. The government aims to garner Rs 950 crore from the 10% stake sale.
Company has fixed July 29 as closing date for qualified institutional investors and July 30 for retail & non-institutional investors.
Entire issue proceeds will get by government against 10% dilution through this public offer and their shareholding will be 80.40% post issue.
ICICI Securities Ltd, HSBC Securities & Capital Markets India Pvt Ltd, IDFC Capital Ltd and SBI Capital Markets Ltd are book running lead managers to the issue. Link Intime India Pvt Ltd is the registrar.
