Ceigall India IPO Listed at 4% Premium Above Issue Price

On Thursday, August 8, Ceigall India Ltd.'s shares had sluggish opening on market, debuting at ₹419 on NSE, 4.49% above issue price of ₹401. In similar vein, stock debuted on BSE at ₹413, 3% premium.

Analysts see company's efficient execution style & emphasis on specialized infrastructure projects as advantages. On other hand, there can be difficulties due to large contingent liabilities, reliance on government contracts, high working capital requirements, & fierce competition.

Mehta Equities' Prashanth Tapse advised investors to "Hold" shares of Ceigall India IPO in long run. Because of its intense focus on project execution, he thinks market may give company premium multiple after listing, which might lead to sizable gains after listing over its issue price.

The company's emphasis on specialized infrastructure projects & effective execution approach, according to Swastika Investmart's Shivani Nyati, are advantages. analyst did point out that there are difficulties, including large contingent liabilities, dependency on government contracts, high working capital requirements, & fierce competition.

"The IPO's valuation at P/E of 20.7 x appears reasonable but not overly attractive given current market conditions," Nyati stated. IPO for Ceigall India had 13.78 subscriptions at closing. With subscription rate of 31.5 x, qualified institutional buyers (QIBs) took lead, followed by non-institutional investors (NIIs) at 14.42 x. 3.77 bookings were made from share designated for retail investors.

37 equity shares were offered in each lot during IPO, with prices ranging from ₹380 to ₹401 per share. offer was combination of newly issued equity shares valued at ₹684 crore by company & offer-for-sale (OFS) of 1.41 crore equity shares by current shareholders & promoters. offer was available for subscription from August 1 to August 5.
Out of fresh issue proceeds, company plans to purchase equipment with ₹99.8 crore, pay off debt with ₹413.4 crore, & use balance money for general corporate reasons. Ceigall India owed ₹1,883.4 crore in unpaid debt.

The infrastructure building business Ceigall India was founded in 2002 & specializes in specialized structural projects such as runways, flyovers, elevated roads, bridges, railroad overpasses, tunnels, & highways. Thirteen EPC projects & five HAM projects are among company's eighteen active projects. These include multi-lane highways, elevated corridors, flyovers, expressways, tunnels, runways, & metro projects. Ceigall India has experienced notable expansion in past several fiscal years, with profit in fiscal year 2024 that increased 83% to ₹306.1 crore over prior year. In same time frame, company's revenue increased by 46.5% to ₹3,029.4 crore.

With margin expansion of 280 basis points at 17.1%, EBITDA, or profits before interest, tax, depreciation, & amortisation, increased 75.1% to ₹517.7 crore in fiscal year 2024 compared to fiscal year 2023.

To Summarize

Ceigall India Ltd. shares had mixed market debut on Thursday, August 8. shares listed at ₹419 on NSE, marking 4.49% premium above issue price of ₹401, while on BSE, shares opened at ₹413, 3% premium. IPO was well-received, with subscription rate of 13.78 x overall, driven by strong interest from qualified institutional buyers (QIBs) at 31.5 x. offer included mix of newly issued equity shares & offer-for-sale (OFS) by existing shareholders.