RVNL, which is a project executing agency working for and behalf on Ministry of Railways, has an order book of Rs 77,500 crore.
Markets News: The Rs 482 crore initial public offering (IPO) of state-run Rail Vikas Nigam (RVNL) will open on Friday and close on April 3. The price band has been fixed at Rs 17 – Rs 19 per share. The issue is entirely an offer for sale (OFS) of 25.35 crore shares (12.2 per cent of post-dilution equity) by Government of India. Of the total issue, 0.3 per cent, or 6,57,280 shares, are reserved for the employees of RVNL. Retail investors and employees will be offered a discount of Rs 0.5/share.
SHOULD YOU SUBSCRIBE?
Most analysts have assigned ‘subscribe’ rating to the IPO, given its robust executable order book, growth prospects, government focus on rail infrastructure spend and attractive valuation.
In the recent past, two Indian Railway entities – IRCON International (IRCON) and RITES (RITES) – debuted at the bourses. Of these, only RITES is trading above the IPO price, while the former is trading at 16 per cent discount (as of Thursday’s close) to the IPO price.
“RITES predominantly is a consulting arm of Indian Railways, while IRCON is normally into project execution and can execute projects across the spectrum. Though both IRCON and RITES are not perfect peers to RVNL but can be considered as proxy peers as they majorly cater to Indian Railways,” wrote analysts at Choice Research in the IPO note…
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