Garuda Construction and Engineering IPO: Financials, Key Risks And More, All You Need To Know

Garuda Construction and Engineering plans to open its initial public offering for subscription on Tuesday, aiming to sell shares valued at an aggregate of Rs 264.1 crore. The IPO consists of a fresh issue of Rs 173.85 crore and the rest as part of an offer for sale.

The price band has been set at Rs 92-95 per share for the IPO issue, which is set to close on Oct. 10, with the listing expected to take place on Oct. 15. At the upper end of the price band, the company's market value is Rs 883.9 crore.

• Issue opens: Oct 8.

• Issue closes: Oct 10.

• Issue price: Rs 92-95 per share.

• Fresh issue: Rs 173.85 crore.

• Offer For Sale: Rs 90.25 crore

• Total issue size: Rs 264.1 crore.

• Working Capital Requirements

• General Corporate Expenses and Unidentified Inorganic Acquisitions

Garuda Construction and Engineering Ltd. provides end-to-end civil construction services for residential, commercial, infrastructure, and industrial projects, as well as additional services for infrastructure and hospitality projects.

Currently, the company is working on six residential projects, two commercial projects, one industrial project, and one infrastructure project.

As of the date of filing, they have an order book aggregating to Rs 14,082.7 crore. Garuda is now planning to directly enter into contracts with unrelated third parties and is aiming to take on a larger role as a developer.

• The company's total revenue comes from its top 10 clients, mainly promoter-related entities and group companies.

• In recent fiscals, the company experienced negative cash flow, as detailed below. Sustained negative cash flow could adversely impact their business, financial condition, and results of operations.

• The company's promoter group, PKH Venture Ltd., withdrew its previous IPO due to lack of subscriber interest.

• The company’s business operations require significant working capital. Insufficient cash flows to meet working capital requirements could have a negative impact on operational outcomes.