Dinesh Engineers intends to raise Rs 183 crore at lower end and Rs 185 crore at higher end of the price band.
Dinesh Engineers, the passive communication infrastructure provider, will open its initial public offering for subscription on September 28 with a price band at Rs 183-185 per share for the issue.
The issue will close on October 3 while the anchor investor book will open for a day on September 27, a day prior to the bid/offer opening date.
Hem Securities is the book running lead manager to the issue and the registrar to the issue is Link Intime India. Equity shares of the company are proposed to be listed on Bombay Stock Exchange and National Stock Exchange.
Here are 10 key things you should know before subscribing the issue:
Dinesh Engineers is focused on providing passive communication infrastructure services mainly to the telecom operators and internet service providers (ISPs).
The company was incorporated in 2006, and through the next several years, it is working towards executing the fiber laying work for many telecom operators.
Its key expertise lies in the field of providing support services to telecom vendors which includes project management for laying of the duct and optic fibre cables, construction of basic transmission and telecom utilities, dark fiber leasing, optical fiber network construction, maintenance of duct and optic fibre and optical fibre project turnkey services to various telecom network operators & broad band Service operators across the states of India.
Since the receipt of the IP-I license, the company have created its own optic fibre network of around 7500 kms which runs across the state of Rajasthan, Gujarat, Maharashtra, Goa, Karnataka, Andhra Pradesh and Telengana. Its wired network infrastructure solutions are used by many telecom companies such as Airtel, BSNL, Reliance Jio, Vodafone, Idea, Tata Communication etc.
Since the year 2011, it has laid fibre network of around 9500 Kms for the telecom operators under the vendor projects.
Apart from telecom clients, it also has Mahanagar Gas in client list for laying gas pipeline in Mumbai. The work of laying the gas pipeline has been undertaken through outsourcing the same to the sub-contractors.
Company's business operations can be briefly classified under three heads - Project Execution for Telecom operators (Vendor Projects); Laying fiber under IP-I License (IP-I); and Operations & Maintenance (O&M).
The initial public offering consists of up to 1 crore equity shares. Bids can be made for a minimum lot of 80 equity shares and in multiples of 80 shares thereafter.
Money to be raised
The company intends to raise Rs 183 crore at lower end and Rs 185 crore at higher end of price band.
Usage of proceeds
Dinesh Engineers will utilise net issue proceeds for expansion of business by setting up of further OFC network under IP-1 license; fund expenditures towards general corporate purposes; and to meet public issue expenses.
> Company has established optic fiber network in India.
> Company has strong project management and execution capabilities.
> Growth is largely attributable to efficient business model which involves careful identification and assessment of the project with emphasis on cost optimisation which is a result of executing our projects with careful planning and strategy. Core business of leasing the fibre and duct on IRU basis to telecom operators is a unique business model which forms a major portion of our revenue.
> Its quality and on-time execution has helped it forge strong relationships with major clients.
> It has experienced promoter, management team and skilled workforce.
> Company believes in maintaining and adheres to quality standards.
> It has co-ordial relationship with suppliers and contractors.
Business and Growth Strategies
> To enhance the coverage of the Optic fiber network.
> Expand into business areas that create synergies with current business
> Augment customer relationships
> Enhance project execution capabilities
> Continue to focus on strengthening the goodwill of name
Financials and Order Book
As of July 2018, the company has laid fiber of around 17,000 Kms for telecom vendors which includes fibre laid under vendor projects and network running across 10 states in India.
Below are the details of the state-wise revenue earned by company in the past three financial years:
Order book consists of the unexecuted portions of outstanding orders, that is, the total contract value of the existing contracts secured by company, as reduced by the value of work executed and billed until the date of such order book. Total order book was approximately Rs 420 crore as of April 2018.
Promoters Dinesh Kollaiah Kargal and Shashikala Dinesh Kargal currently hold 54.99 percent stake and 44.99 percent respectively.
Dinesh Kollaiah Kargal is one of the Promoter and Managing Director of company. He has been on the board of directors of company since its incorporation. He has approximately 27 years of experience in the telecom infrastructure industry.
Shashikala Dinesh Kargal is one of the promoter and whole-time director of company. She has been on the board of directors of company since its incorporation. She has approximately 23 years of experience in the telecom infrastructure industry.
Aksh Devesh Jain is the Chief Financial Officer of company. He is a qualified Chartered Accountant from Institute of Chartered Accountant of India. He has experience of approximately 2 years 5 months.
Risks and Concerns
Disclosure: Reliance Industries Ltd. (which owns Reliance Jio) is the sole beneficiary of Independent Media Trust which controls Network18 Media & Investments Ltd.