SRM Contractors shares list at 7% premium

Shares of SRM Contractors listed on BSE at a premium of 7% on Wednesday. The stock debuted at Rs 225 on BSE as against an offer price of Rs 210. On NSE, it listed at Rs 212.5 per share, an upside of 2.5% over the IPO price

Ahead of the listing, the company’s shares commanded a GMP of Rs 95.

The issue was booked 86 times at close on strong interest from non-institutional investors.

SRM Contractors’ outlook is bolstered by several key strengths, including its proven track record of efficiently executing road, tunnel, and slope stabilization projects within their focused region.

Apart from the listing gains, analysts also see a compelling proposition for investors with a long-term perspective.

“Owning their equipment and operating an in-house integrated model ensures project control and cost-efficiency. Additionally, the company has a history of consistent financial performance and maintains a healthy order book, indicating continued revenue generation and growth potential,” said Shivani Nyati, Head of Wealth, Swastika Investmart.

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SRM Contractors is an engineering construction and development company engaged primarily in the construction of roads (including bridges), tunnels, slope stabilisation works and other miscellaneous civil construction activities in the union territories of Jammu and Kashmir and Ladakh.

The company undertakes construction works both as an EPC contractor and on an item rate basis for infrastructure projects. It also does sub-contracting assignments of infrastructure construction projects.

In recent years, J&K has received a boost in road infrastructure development, following the government’s enhanced focus on improving road infrastructure in the region.

In FY23, the company’s revenue from operations increased 13% to Rs 300 crore, while profit after tax rose 7% to Rs 18.74 crore. For the nine months ended December 2023, revenues stood at Rs 242 crore and PAT came in at Rs 20.17 crore.

Interactive Financial Services was the sole book-running lead manager for the IPO and Bigshare Services was the registrar.

Saloni Goel

The Economic Times

William Murphy

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