Vishnu Prakash R Punglia IPO oversubscribed within couple of hours of opening

Vishnu Prakash R Punglia IPO: Vishnu Prakash R Punglia shares were in very high demand during the three-day share sale via initial public offering (IPO) which began today at 10:00 am. The IPO was oversubscribed in less than two hours of opening, data from the National Stock Exchange showed. The IPO was subscribed 1.02 times by 11:42 am. Retail investors were seen participating in large numbers for Vishnu Prakash R Punglia shares in the IPO as the portion set aside for them was subscribed 1.34 times.

Retail investors had placed bids for 1.44 crore shares compared with 1.08 crore shares reserved for them.

Non-institutional investors, which include high net-worth individuals (HNIs), were also seen participating with enthusiasm as the pie set aside for them was booked 98 per cent. Pie set aside for investors putting in more than Rs 2 lakh and up to Rs 10 lakh was subscribed 1.5 times.

Qualified institutional buyers like banks, financial institutions, FIIs and mutual funds were yet to participate in the IPO.

Vishnu Prakash R Punglia IPO details

Vishnu Prakash R Punglia is planning to raise Rs 309 crore from the IPO which is a fresh issue of shares. The company has fixed price band of Rs 94-99 per share and a retail investor can bid for minimum one lot of 150 shares up to maximum of 13 lots. One lot of Vishnu Prakash R Punglia shares in the IPO is priced at Rs 14,850 at the upper end of the price band.

The company plans to use proceeds from IPO for funding capital expenditure requirements, funding working capital requirements and for general corporate purposes.

About Vishnu Prakash R Punglia

Vishnu Prakash R Punglia Limited (VPRPL) is a well-known construction company that is primarily engaged in infrastructure projects for the central and state governments. The company is focused on water supply projects and is benefiting from various government initiatives. VPRPL has a track record of successfully completing projects and has achieved notable growth through a robust order book. The company also has an in-house integrated model that helps it to successfully implement its projects.

However, as VPRPL is in the construction industry, it faces stiff competition and high working capital requirements. There is also the risk of project implementation delays and cost overruns. VPRPL has also reported negative cash flow in recent years.

“Despite these challenges, the IPO is coming at a fair valuation of price to equity (P/E) of 9.5 times. Our overall outlook on the infrastructure sector is bullish, and we recommend applying for this IPO,” brokerage firm Swastika Investmart said in a report.