Review By on March 10, 2017
Relstruct Buildcon Ltd (RBL) is in a construction/ real estate business. It had successfully undertaken, executed and completed residential projects in Mumbai such as Pujari Apartment, Chembur, Giri Niwas, Vikhroli, Sargam Tower, Tilak Nagar, Hill View Apartment, Chembur with assured quality standards. With determined efforts and gradually progression, Company undertook the business of constructing buildings, township, commercial complexes and constructional works of every description on any land owned by them or upon any other land or immovable property owned by the landlord as a joint venture as well as co-developers. As a real estate developer with a diversified portfolio of real estate projects, it also undertakes redevelopment of government housing projects, customized infrastructure projects, marketing of residential and commercial unit and offering our consultancy\ liason service for real estate projects.
As part of growth plan, RBL has taken up projects in and around Mumbai, Maharashtra. Currently, its business activity includes Development and construction of Residential and Commercial Complex, Re development and Slum Redevelopment project under Development \ joint venture basis, Development of Township and affordable housing project near Metro cities, Infrastructure development under work contract from Government authority and corporate and Consultancy, Design and Drawing for Real Estate project and monitor them during implementation
To part finance its on hand construction and development work, purchase of equipments, general corpus fund needs, the company is coming out with a maiden IPO of 4671000 equity share of Rs. 10 each at a fixed price of Rs.50 per share to mobilize Rs. 23.36 crore. Issue opens for subscription on 22.03.17 and will close on 24.03.17. Minimum application is to be made for 3000 shares and in multiples thereon, thereafter. Post allotment, shares will be listed on BSE SME. Issue is solely lead managed by Monarch Networth Capital Ltd and Karvy Computershare Pvt Ltd is the registrar to the issue. Till 2015 it issued all equity at par and then in April 2016 it issued further equity at a price of Rs. 22 per share. Its current paid up equity capital of Rs. 10 crore will stand enhanced to Rs. 14.67 crore post issue.
On performance front, it has posted revenue/net profits of Rs. 0.04 cr. / Rs. 0.003 cr. (FY15) and Rs. 0.26 cr. / Rs. 0.008 cr. (FY16). For nine months ended 31.12.16 it has posted net profit of Rs. 0.03 crore on a revenue of Rs. 0.22 crore. If we annualize these earnings and attribute on fully diluted equity post issue then asking price is at a P/E of 16600 plus making it a highly priced risky bet.
On merchant banker’s front, this is the 4th mandate and earlier mandates have given some rewards on listing day.
Conclusion: Issue is very highly priced and having a business in most competitive field. Only risk savvy cash surplus investors may consider it for long term.
Review By on March 10, 2017
Dilip Davda is a veteran financial journalist associated with the Indian stock market since 1978. He has been contributing to print and electronic media on capital markets, insurance, and finance since 1985.
He is widely recognized for reviewing public issues and non-convertible debentures (NCDs) in the primary market. Drawing on over three decades of market experience and close interaction with merchant bankers, his reviews focus on detailed fundamental and financial analysis of companies, with a special emphasis on SME public issues.
Dilip Davda
SEBI Registered Research Analyst – Mumbai
Registration No.: INH000003127 (Perpetual)
Email: dilip_davda@rediffmail.com
Disclaimer: The information provided herein is solely for educational and informational purposes and does not constitute an offer, solicitation, or recommendation to buy or sell any securities. Readers are advised to consult a qualified financial advisor before making any investment decisions. Investments in the securities market are subject to market risks. The author does not intend to invest in the securities discussed.
The initial public offer (IPO) of Relstruct Buildcon Ltd. offers an early investment opportunity in Relstruct Buildcon Ltd.. A stock market investor can buy Relstruct Buildcon IPO shares by applying in IPO before Relstruct Buildcon Ltd. shares get listed at the stock exchanges. An investor could invest in Relstruct Buildcon IPO for short term listing gain or a long term.
Read the Relstruct Buildcon IPO recommendations by the leading analyst and leading stock brokers.
Relstruct Buildcon IPO offers an opportunity to buy IPO shares before they get listed at the stock exchanges. Read the Relstruct Buildcon IPO Notes, Analysis and Recommendations by leading stock brokerage firms and experts mentioned in the above answer to "How is Relstruct Buildcon IPO?"
Our recommendation for Relstruct Buildcon IPO is to subscribe for long term.
As per the analysis by our lead analyst Mr. Dilip Davda, we suggest you to subscribe for long term to the Relstruct Buildcon IPO.
The Relstruct Buildcon IPO allotment status will be available on or around [.]. The allotted shares will be credited in demat account by [.]. Visit Relstruct Buildcon IPO allotment status to check.
