Teerth Gopicon Limited, a leading infrastructure development company in India, is launching its initial public offering (IPO) on April 8, 2024. This article provides a comprehensive analysis of the Teerth Gopicon IPO, including the company’s background, business operations, financial performance, and key details about the IPO itself. By understanding these factors, potential investors can make informed decisions about whether to participate in the offering.
Company Background:
Established in 2019, Teerth Gopicon Limited specializes in civil engineering projects including road construction, sewerage, and water supply services in Madhya Pradesh. Additionally, the company has extensive experience as a subcontractor, having completed notable projects such as a residential tower in Indore.
With registrations as a contractor for various central and state governments, including ISCDL, IMC, USCL, UMC, MPJNM, Teerth Gopicon has a diverse portfolio. Their projects range from building construction to sewage treatment plants, water supply systems, pipelines, and road construction, catering to both government and private sectors.
Business Operations:
Teerth Gopicon’s business operations can be broadly categorized into two segments: road construction and water supply system construction.
- Road Construction: The company undertakes the construction of highways, state roads, rural roads, and urban roads. Teerth Gopicon has experience in working on various road projects, including new build construction, rehabilitation projects, and widening of existing roads.
- Water Supply System Construction: Teerth Gopicon designs, constructs, and maintains water supply systems for municipalities and industrial clients. The company’s expertise encompasses intake structures, treatment plants, distribution networks, and storage facilities.
Teerth Gopicon’s business model involves bidding on government and private sector contracts for infrastructure development projects. Once a contract is awarded, the company mobilizes its resources, including manpower, equipment, and materials, to complete the project according to the specified timelines and quality standards.
Teerth Gopicon Limited Shows Financial Growth in Restated Results.
Teerth Gopicon Limited has released restated financial information revealing a positive trend in the company’s performance. The information covers a four-year period ending January 31st, 2024.
Key Highlights:
- Growth in Assets: The company’s assets have shown a steady increase, rising from ₹3,115.47 crore in March 2021 to ₹13,719.79 crore by January 2024. This represents a significant growth of over 337% in three years.
- Revenue Increase: Revenue has also followed an upward trajectory, climbing from ₹4,620.74 crore in March 2021 to ₹6,970.02 crore by January 2024. This translates to a growth of approximately 51% over the period.
- Profitability: Profit after tax has seen a substantial improvement. While the figures for March 2021 are not disclosed, profit after tax jumped from ₹15.27 crore in March 2022 to ₹784.04 crore by January 2024. This represents a growth of over 50 times.
- Strengthening Net Worth: Teerth Gopicon Limited’s net worth has exhibited significant growth, increasing from ₹594.22 crore in March 2021 to ₹1,572.74 crore by January 2024. This reflects a rise of over 164%.
- Increase in Borrowing: The company’s total borrowing has also risen, climbing from ₹933.82 crore in March 2021 to ₹937.18 crore by January 2024. However, it’s important to note this increase is relatively small compared to the significant asset growth.
It’s important to note that the financial information has been restated, so direct comparisons to previous reports may not be possible.
Teerth Gopicon IPO: Key Performance Indicators Breakdown.
- Return on Equity (ROE): 66.40% – This ratio indicates a strong return on shareholder investment. In simpler terms, for every rupee invested by shareholders, the company is generating 66.40 paise in profit.
- Return on Capital Employed (ROCE): 48.40% – This ratio measures how efficiently the company is generating profits from its entire capital base (debt and equity). A healthy ROCE indicates good use of capital.
- Debt-to-Equity Ratio: 0.6 – This ratio shows a comfortable level of debt compared to equity. A lower ratio suggests the company is financing its operations more through equity than debt, reducing its financial risk.
- Return on Net Worth (RoNW): 22.72% – Similar to ROE, this ratio reflects the profitability in relation to shareholders’ equity. The RoNW is lower than ROE because it considers only net worth (equity minus liabilities).
- Price-to-Book Ratio (P/BV): 5.65 – This ratio compares the market price of the stock to its book value. A P/B ratio greater than 1 indicates the company is trading above its book value.
- Profit After Tax (PAT) Margin: 11.26% – This ratio shows the profitability of the company’s core operations. A margin of over 11% suggests Teerth Gopicon is able to generate a healthy profit from its revenue.
Teerth Gopicon Limited Objects of the Issue:
Teerth Gopicon’s IPO aims to raise capital for two key objectives: meeting working capital needs and general corporate purposes. This could include funding ongoing operations, investing in future projects, or repaying debt.
Teerth Gopicon Limited IPO Timeline.
| IPO Open Date | Monday, April 8, 2024 |
| IPO Close Date | Wednesday, April 10, 2024 |
| Cut-off time for UPI mandate confirmation | 5 PM on April 10, 2024 |
| Basis of Allotment | Friday, April 12, 2024 |
| Initiation of Refunds | Monday, April 15, 2024 |
| Credit of Shares to Demat | Monday, April 15, 2024 |
| Listing Date | Tuesday, April 16, 2024 |
| Listing At | NSE SME |
Teerth Gopicon Limited IPO Lot Size:
Teerth Gopicon Limited IPO Price ₹111 per share.
| Application | Lots | Shares | Amount |
|---|---|---|---|
| Retail (Min) | 1 | 1200 | ₹133,200 |
| Retail (Max) | 1 | 1200 | ₹133,200 |
Teerth Gopicon SME IPO GMP.
Here’s a breakdown of Teerth Gopicon’s GMP trend as of April 7th, 2024:
- Recent Decline: The GMP has been on a downward trajectory, falling from ₹18 on April 6th to ₹10 on April 7th. This could indicate softening investor interest.
- Estimated Listing Price: Despite the decline, the estimated listing price remains around ₹121, which translates to a potential gain of approximately 9% over the issue price of ₹111.
- Sub2 and Sauda Rates: ‘Sub2’ and ‘Sauda’ rates are additional grey market indicators. While their specific meaning can vary, they generally reflect the price at which smaller lot sizes or pre-determined quantities of shares are being traded. In this case, both Sub2 and Sauda rates have also shown a decrease.
It’s important to remember that GMP is an unofficial and volatile indicator. It should not be the sole factor driving your investment decisions. A thorough analysis of the company’s financials, business prospects, and industry outlook is crucial before investing in any IPO.
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