Garuda Construction and Engineering Limited IPO Review
Neutral95-95 · Mainboard
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Analyst Verdict
Garuda Construction and Engineering Limited IPO
Neutral
IPO at a Glance
Price Band
95-95
Issue Size
264cr
Min. Investment
₹14,915
Opens
2024-10-06
Closes
2024-10-08
Listing
2024-10-13
Category
Mainboard
Key Strengths
✓The company established a track record of successfully executing a diverse mix of construction projects i.e., residential, hospitality, and commercial projects.
✓Quality system managers are appointed within the company, and tasked with periodically conducting thorough inspections and tests at each project’s site. This rigorous approach guarantees potent project management capabilities and competent execution.
✓Over the years, propelled by strong financial performance and a robust balance sheet, the company’s debt-equity ratio has consistently declined. The company has achieved an almost debt-free status over the last two years.
✓The cumulative contract value of their ongoing and impending projects amounts to ₹ 1,40,827.44 lakhs. These projects are dispersed across various locations, including the Mumbai Metropolitan Region (MMR), Arunachal Pradesh, Karnataka, Rajasthan, and Punjab.
Key Risks
⚠The company’s total revenue (100%) comes from its top 10 clients, mainly promoter-related entities and group companies. The loss of any of its significant clients may adversely affect the business prospects.
⚠The company’s limited experience in dealing with unrelated third-party entities presents challenges to its growth If it cannot establish itself successfully as a developer or contractor beyond its promoter group and associated companies.
⚠The construction industry is cyclical and sensitive to changes in the economy and this could have a significant impact on its operations and financial results.
⚠The previous IPO filed by the promoter group, PKH Venture Limited, was not subscribed leading to the withdrawal of the IPO.
⚠Operationally, significant working capital is a prerequisite for the business. If there are insufficient cash flows to meet these working capital requirements, it could negatively impact operational outcomes.
Frequently Asked Questions
Should I apply for Garuda Construction and Engineering Limited IPO?
Based on our analysis, our rating for Garuda Construction and Engineering Limited IPO is: Neutral. Review the full analysis including strengths, risks, and financials on CheckIPO before making a decision.
What are the key risks of Garuda Construction and Engineering Limited IPO?
The company’s total revenue (100%) comes from its top 10 clients, mainly promoter-related entities and group companies. The loss of any of its significant clients may adversely affect the business prospects. The company’s limited experience in dealing with unrelated third-party entities presents challenges to its growth If it cannot establish itself successfully as a developer or contractor beyond
What are the strengths of Garuda Construction and Engineering Limited IPO?
The company established a track record of successfully executing a diverse mix of construction projects i.e., residential, hospitality, and commercial projects. Quality system managers are appointed within the company, and tasked with periodically conducting thorough inspections and tests at each project’s site. This rigorous approach guarantees potent project management capabilities and competent
What is the price band of Garuda Construction and Engineering Limited IPO?
The price band for Garuda Construction and Engineering Limited IPO is 95-95. The IPO has closed.
Full Analysis Available
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