Shankara Building Products lists at Rs 555, 21% premium over issue price
NEW DELHI: Shankara Building Products on Wednesday made a stellar debut on NSE by listing at Rs 555.05, a premium of 20.66 per cent over its issue price of Rs 460 apiece.
On BSE, the stock got listed at Rs 545, up 18.47 per cent. At this price, the company’s market capitalisation stood at Rs 1,245 crore.
The Rs 350-crore initial public offering (IPO), which was sold between March 22 and March 24, received an overwhelming response with investors bidding for 41.88 times the issue size.
The company offers steel-based products, such as pipes and tubes, TMT bars, structural steel and allied steel products. Investor frenzy in the IPO was evident from the fact that non-institutional investors (NIIs) had lapped up their quota limit in the issue by 90.98 times. Qualified institutional buyers (QIBs) had bid for shares 51.62 times the quota limit and retail investors 15.35 times their quota.
At the issue price, the stock was valued at 0.6 times on an EV/sales basis and 19 times on its 9MFY17 earnings per share (EPS) on an annualised basis (post dilution).
As on September 2016, the company was operating 100 Shankara BuildPro stores across 10 states in India. Shankara Buildcon caters to a large customer base across various end-user segments in urban and semi-urban markets through its multi-channel sales approach, processing facilities, supply chain and logistics capabilities.
Retail is a higher margin segment for the company, revenues from which has shot up to 42 per cent as of December 31 from 24 per cent in FY14 9MFY17, primarily due to healthy store expansion. Analysts noted that higher contribution from the retail segment has led to increase in blended Ebitda margins from 4.6 per cent in FY14 to 6.4 per cent in 9MFY17.
On BSE, the stock got listed at Rs 545, up 18.47 per cent. At this price, the company’s market capitalisation stood at Rs 1,245 crore.
The Rs 350-crore initial public offering (IPO), which was sold between March 22 and March 24, received an overwhelming response with investors bidding for 41.88 times the issue size.
The company offers steel-based products, such as pipes and tubes, TMT bars, structural steel and allied steel products. Investor frenzy in the IPO was evident from the fact that non-institutional investors (NIIs) had lapped up their quota limit in the issue by 90.98 times. Qualified institutional buyers (QIBs) had bid for shares 51.62 times the quota limit and retail investors 15.35 times their quota.
At the issue price, the stock was valued at 0.6 times on an EV/sales basis and 19 times on its 9MFY17 earnings per share (EPS) on an annualised basis (post dilution).
As on September 2016, the company was operating 100 Shankara BuildPro stores across 10 states in India. Shankara Buildcon caters to a large customer base across various end-user segments in urban and semi-urban markets through its multi-channel sales approach, processing facilities, supply chain and logistics capabilities.
Retail is a higher margin segment for the company, revenues from which has shot up to 42 per cent as of December 31 from 24 per cent in FY14 9MFY17, primarily due to healthy store expansion. Analysts noted that higher contribution from the retail segment has led to increase in blended Ebitda margins from 4.6 per cent in FY14 to 6.4 per cent in 9MFY17.
