Ceigall India IPO opens on August 1, price band to be announced on July 29

Ceigall India IPO

Infrastructure construction company Ceigall India will open its initial public offering for subscription on August 1. The price band for the offer will be announced on July 29.

The IPO is a mix of fresh issuance of equity shares worth Rs 684.3 crore by the company, and an offer-for-sale (OFS) of 1,41,74,840 equity shares by existing shareholders including promoters.

Promoters Ramneek Sehgal, Ramneek Sehgal and Sons HUF, Avneet Luthra, Mohinder Pal Singh Sehgal, Parmjit Sehgal, and Simran Sehgal are the selling shareholders in the OFS.

The Sehgal family-promoted company has reserved up to Rs 2 crore worth of shares for its employees who may get shares at a discount to the final issue price.

The maiden public issue will close on August 5, while the anchor book will be opened for a day on July 31, a day before the IPO opening.

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Half of the net issue (excluding employees' portion) is reserved for qualified institutional buyers (QIBs), 35 percent for retail investors, and the remaining 15 percent shares for non-institutional investors (high net-worth individuals).

The Sehgal family owned 99.99 percent shareholding in the Delhi-based company, while Kanwaldeep Singh Luthra is the only public shareholder with 16,000 shares or 0.01 percent of paid-up equity.

Ceigall India, which has transitioned from a small construction company to an EPC player in the last two decades, has an order book of Rs 9,470.8 crore including an 80.3 percent project from the National Highway Authority of India (NHAI). It has completed over 34 projects, including 16 EPC, in the roads and highways sector, while currently, it has 18 ongoing projects, including 13 EPC projects and five HAM projects.

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The company, comparing itself with KNR Construction, J Kumar Infraprojects, ITD Cementation India, PNC Infratech, GR Infraprojects, and HG Infra Engineering, will spend Rs 99.8 crore out of the fresh issue proceeds for purchasing equipment, Rs 413.4 crore for repaying debts, and the remaining funds for general corporate purposes. It had an outstanding borrowings of Rs 1,883.4 crore.

The infrastructure company has recorded significant growth in the last financial years with the profit in fiscal 2024 growing 83 percent to Rs 306.1 crore compared to the previous year. Revenue increased by 46.5 percent to Rs 3,029.4 crore during the same period.

EBITDA (earnings before interest, tax, depreciation and amortisation) in fiscal 2024 grew by 75.1 percent to Rs 517.7 crore with a margin expansion of 280 bps at 17.1 percent compared to fiscal 2023.

The company will finalise the basis of the allotment of IPO shares by August 6 and credit equity shares to the demat accounts of eligible investors by August 7.

The stock will make its debut on the bourses, effective August 8.

ICICI Securities, IIFL Securities, and ICICI Securities are the merchant bankers appointed to manage the public. Link Intime India is the registrar of the offer.