SRM Contractors IPO subscribed over 86 times on final day

SRM Contractors IPO: SRM Contractors shares in the initial public offering (IPO) were in very high demand among  investors as it received bids for 37.57 crore shares as against the 43.40 lakh shares on offer. The issue was subscribed an impressive 86.57 times, data from stock exchanges showed on Thursday, March 28, 2024.

The IPO, which opened for bidding on Tuesday, March 26, 2024, closed on Thursday with a price band set between Rs 200 to 210 per share. Retail investors were required to bid for a minimum of 70 equity shares and in multiples thereof.

The offering consisted of a fresh issue of 62,00,000 equity shares, with the company planning to utilise the net proceeds to fund various capital expenditure requirements. These include purchasing equipment and machinery, settling outstanding secured borrowings, fulfilling incremental working capital needs, investing in project-specific JV projects, and allocating the balance toward general corporate purposes.

Prior to the IPO, SRM Contractors raised Rs 39.05 crore from anchor investors on Friday, March 22, 2024. The company allotted 18.59 lakh shares to three anchor investors at Rs 210 each.

SRM Contractors specialises in engineering construction and development, focusing on projects in challenging terrains such as the Union Territories of Jammu & Kashmir and Ladakh. Their scope of work includes construction of roads, bridges, tunnels, slope stabilization works, and other civil construction activities.

The company operates both as an Engineering, Procurement, and Construction (EPC) contractor and on an item rate basis for infrastructure projects. It collaborates with other infrastructure and construction entities through project-specific joint ventures to meet specific eligibility requirements for large projects.

For the nine months ended December 31, 2023, SRM Contractors reported a net profit of Rs 21.07 crore and sales of Rs 234.55 crore.