AVP Infracon
Listing performance
Scheduled dates
Tentative timetable — a past date is not confirmation the step completed
Issue details
- IPO date
- 13 Mar 2024 – 15 Mar 2024
- Listing date
- 20 Mar 2024
- Face value
- ₹10 per share
- Issue price
- ₹75 per share
- Lot size
- 1,600 shares
- Issue type
- Book Building issue
- Total issue size
- ₹52.34 Cr
- Market cap at offer price
- ₹187 Cr
- Promoter holding
- 86.50% → 62.33% pre-issue → post-issue
- ISIN
- INE0R9401019
- Registrar
- Purva Sharegistry (India) Pvt.Ltd.
- Lead managers
- Share India Capital Services Pvt.Ltd.
- Registered office
- Plot No.E-30, Second floor, 2nd Avenue, Besant Nagar, Tamil Nadu
Reservation and application size
How the issue is split between investor categories, and what each may bid
| Investor category | Shares | % of net | % of total |
|---|---|---|---|
| Anchor investor · within QIB | 18,70,400 | — | — |
| Market maker | 7,31,200 | — | — |
Application size
Minimum 1,600 shares per lot, in multiples, at ₹75
| Application | Lots | Shares | Amount |
|---|---|---|---|
| Retail (min) | 1 | 1,600 | ₹1,20,000 |
| S-HNI (min) | 2 | 3,200 | ₹2,40,000 |
| S-HNI (max) | 8 | 12,800 | ₹9,60,000 |
| B-HNI (min) | 9 | 14,400 | ₹10,80,000 |
Category limits
| Category | Bid size | Cut-off |
|---|---|---|
| Retail (RII) | Up to ₹2 lakh | Yes |
| Small HNI (sNII) | ₹2 lakh – ₹10 lakh | No |
| Big HNI (bNII) | Above ₹10 lakh | No |
| Employee | Up to ₹5 lakh | Yes |
Bidding at cut-off means accepting the final issue price without naming one. Only retail and employee applicants may do so.
Anchor investors
Institutional allocation placed a day before the issue opens, carved out of the QIB portion and locked in after listing.
Valuation and performance
Valuation at offer price
| Metric | Pre-issue | Post-issue |
|---|---|---|
| EPS (₹) | 6.70 | 5.87 |
| P/E (×) | 11.19 | 12.78 |
| Price to book (×) | 3.96 | — |
| Market cap | — | ₹187 Cr |
Key performance indicators
- Return on net worth
- 25.05%
- ROCE
- 22.63%
- Debt / equity
- 1.96
- PAT margin
- 11.91%
- NAV per share
- ₹18.50
- Price to book
- 3.96
Single period as reported. Year-on-year movement is in the financials table below, where every period is published.
About AVP Infracon
AVP Infracon Limited (formerly AVP Constructions Private Limited) was incorporated on September 09, 2009, and converted to a public limited company in November 2023. The company is engaged in the business of construction, design, and execution of infrastructure developmental works across technically complex and high-value projects. The company operates primarily in Tamil Nadu, India, undertaking construction projects for government entities and authorities funded by the Government of India or state governments. The company generates revenue from contracts involving design, engineering, procurement, and construction (EPC) of road and infrastructure projects, as well as projects based on Bill of Quantities (BOQ) methods. As of October 31, 2023, the company had 14 projects including 12 ongoing projects worth approximately ₹20,188.91 lakhs and 2 additional projects (where AVP Infracon became L1) worth ₹3,421.34 lakhs.
Company Analysis
from RHPAVP Infracon Limited is a dynamic private sector construction firm engaged in designing and executing technically complex infrastructure projects including expressways, national highways, flyovers, bridges, viaducts, irrigation projects, and urban development works using BOQ and EPC methods.
AVP Infracon Limited (formerly AVP Constructions Private Limited) was incorporated on September 09, 2009, and converted to a public limited company in November 2023. The company is engaged in the business of construction, design, and execution of infrastructure developmental works across technically complex and high-value projects. The company operates primarily in Tamil Nadu, India, undertaking construction projects for government entities and authorities funded by the Government of India or state governments. The company generates revenue from contracts involving design, engineering, procurement, and construction (EPC) of road and infrastructure projects, as well as projects based on Bill of Quantities (BOQ) methods. As of October 31, 2023, the company had 14 projects including 12 ongoing projects worth approximately ₹20,188.91 lakhs and 2 additional projects (where AVP Infracon became L1) worth ₹3,421.34 lakhs.
Objects of the Issue
- Capital Expenditures (for procurement of road laying equipment, loading equipment, batching plant equipment, and material handling equipment) ₹1,500.00 lakhs p.24
- Meet Working Capital Requirements ₹3,500.00 lakhs p.24
- General corporate purposes p.24
- To Purchase Capital Equipment ₹1,500.00 lakhs p.88
- To Meet Working Capital Requirements ₹3,500.00 lakhs p.89
- General corporate purposes ₹[●] lakhs (not exceeding 25% of gross proceeds) p.97
- To meet Public Issue Expenses ₹[●] lakhs p.86
Issue Structure
- Total Issue
- Up to 69,79,200 Equity Shares aggregating to ₹[●] Lakhs
- Fresh Issue
- Up to 69,79,200 Equity Shares of face value of ₹10/- each aggregating to ₹[●] Lakhs (100% Fresh Issue)
- Offer for Sale
- Nil (not applicable as the entire issue constitutes fresh issue of equity shares)
- Price Band
- [●] (to be determined and advertised at least two working days prior to Bid/Issue Opening Date)
- Lot Size
- [●] (to be decided by the company in consultation with BRLM)
- Face Value
- ₹10/- each
Business Model
The company earns revenue from design, engineering, procurement, and construction (EPC) contracts as well as projects based on Bill of Quantities (BOQ) methods. The company primarily derives its revenue from infrastructure construction projects awarded by government entities and authorities funded by the Government of India or state governments. As of October 31, 2023 (7-month period), the company reported revenue from operations of ₹6,918.69 lakhs (standalone).
Business Segments
SWOT Analysis
- • 14 years operational experience with 40+ completed projects(p.128)
- • Strong order book with 12 ongoing projects worth ~₹20,189 lakhs plus 2 additional awarded projects(p.129)
- • Demonstrated financial growth with 66.44% YoY revenue growth in FY2023(p.104)
- • In-house end-to-end project delivery capability from conceptualization to completion(p.128)
- • Improved EBITDA margins expanding from 10.27% (FY2021) to 19.08% (FY2023)(p.104)
- • Strong return on equity of 46.18% in FY2023 and 37.04% ROCE(p.104)
- • Joint venture partnerships to handle larger projects (JWP-AVP with 10% stake, CDR-AVP with 20% stake)(p.129)
- • Experienced promoters with 18+ years in infrastructure sector(p.135)
- • Strong order book worth ~₹23,543.83 lakhs from government clients(p.135)
- • Modern fleet of construction machinery and equipment(p.135)
- • Quality assurance and repetitive orders from customers(p.135)
- • Long-standing relationships with government clients (PWD, NHAI, MoRTH)(p.135)
- • Improved liquidity through government project focus(p.135)
- • Engaged in technically complex, high-value infrastructure projects(p.222)
- • Significant revenue growth over three financial years(p.293)
- • Improved profitability with strong PAT growth(p.294)
- • Growing fleet of owned vehicles reducing transportation costs(p.299)
- • Effective cost management and operational efficiency(p.298)
- • Strong EBITDA margin performance(p.276)
- • Entire revenue concentrated in Tamil Nadu with no diversification across states(p.30)
- • Lack of ownership of registered office; dependence on lease renewable annually(p.30)
- • Substantial working capital requirements with no guarantee of securing funds timely(p.31)
- • Negative cash flows from operations, investing, and financing activities(p.31)
- • Majority revenue from limited government customers, subject to policy changes(p.32)
- • High secured debt burden with lender charge over movable properties(p.34)
- • Unsecured director loans of ₹1,704.92 lakhs repayable on demand(p.39)
- • Corporate governance delays and non-compliances in statutory filings(p.36)
- • Delays in EPF and GST returns filing with accumulated late fees and interest(p.37)
- • Trademark application not yet approved; risk of third-party infringement(p.36)
- • High debt-to-equity ratio of 2.2 in FY2023 indicating significant leverage(p.107)
- • Negative operating cash flow of ₹869.79 lakhs in FY2023(p.104)
- • Revenue concentration risk with few major customers(p.133)
- • Deteriorating current ratio from 1.49 (FY2022) to 1.38 (FY2023) suggesting liquidity pressure(p.104)
- • Significant working capital lock-in from EMD deposits and retention money(p.96)
- • High inventory holding levels of 146 days (FY2023) contributing to working capital strain(p.90)
- • High dependence on top suppliers for raw materials(p.138)
- • Geographic concentration in Tamil Nadu and limited presence(p.136)
- • Small organization with 43 full-time employees and 85 contractual workers(p.156)
- • Customer concentration with top 10 clients representing 91.91% of revenue in FY22-23(p.139)
- • Insurance coverage may not adequately protect against all material hazards(p.156)
- • High proportion of debt financing relative to equity(p.282)
- • Significant dependence on director loans for financing(p.263)
- • Large inventory holding relative to business scale(p.219)
- • Declining cash position year-on-year(p.219)
- • High proportion of work-in-progress creating liquidity challenges(p.237)
- • Concentration of significant revenue and PAT on limited projects(p.297)
- • Concentrated debt across multiple lenders with varying repayment terms and high interest rates(p.304)
- • Significant director loans creating internal financial dependency(p.307)
- • Indian infrastructure sector forecast with 36.16% CAGR in roads and highways market(p.22)
- • Government initiatives like Gati Shakti national master plan and Smart Cities Mission(p.22)
- • Strong growth trajectory of Indian economy with GDP growth of 7.2% in FY 2022-23(p.22)
- • Infrastructure sector as key facilitator for achieving US $26 trillion economy(p.22)
- • Increased Public-Private Partnership engagement through Hybrid Annuity Model(p.23)
- • National Highways Authority expansion with target of 40 km/day construction in FY2024(p.126)
- • Bharatmala Pariyojana projects across 19,265 km with ₹5,60,216 crore awarded(p.127)
- • PM Gati Shakti National Master Plan with coordinated multi-modal infrastructure projects(p.127)
- • Roads and highways market projected to grow at 36.16% CAGR from 2016-2025(p.125)
- • Government infrastructure capex allocation increased 33% to ₹10 lakh crore for FY2024(p.122)
- • India's economic growth forecast at 6.3% for FY2024 supporting infrastructure demand(p.115)
- • Expansion into urban infrastructure and multi-modal logistics parks under NIP(p.122)
- • Expansion to other regions in South India(p.136)
- • Joint venture arrangements for larger value projects(p.136)
- • Enhance in-house integration and reduce third-party dependency(p.137)
- • Cost efficiency through technology upgradation(p.136)
- • Hedge geographic concentration risk through multi-state expansion(p.136)
- • Expansion into urban development and civic amenity projects(p.222)
- • Growing pipeline of new projects and tenders(p.298)
- • Potential for further cost optimization through fleet utilization(p.298)
- • Opportunity to leverage IPO funds for debt reduction and working capital(p.282)
- • Global economic slowdown forecast with growth declining to 2.9% by 2024(p.21)
- • Intense competition from domestic and international companies with larger resources(p.47)
- • Risk of time and cost overruns in construction projects due to implementation uncertainties(p.33)
- • Dependence on third-party transportation providers for raw material delivery(p.44)
- • Substantial risks from labor availability and wage inflation in construction sector(p.44)
- • Exposure to natural disasters, terrorist attacks, and civil unrest in India(p.50)
- • Inflation in India could increase operational costs without corresponding revenue increase(p.51)
- • Government regulation of foreign ownership could restrict investor participation and valuations(p.51)
- • Highly competitive road construction sector with multiple established players(p.133)
- • Volatility in raw material prices (cement, steel, bitumen) affecting project profitability(p.91)
- • Dependence on government contract awards with project concentration risk(p.133)
- • Long project defect liability periods (3-5 years) locking up retention money(p.96)
- • Exposure to monsoon and weather-related project delays in Tamil Nadu operations(p.129)
- • Regulatory changes in infrastructure standards and SEBI (ICDR) compliance requirements(p.67)
- • Foreign exchange and input cost inflation risks for imported machinery and materials(p.114)
- • Risk of time and cost overruns in project execution(p.173)
- • Physical hazards and operational risks in construction(p.156)
- • Regulatory changes to National Highways policies and tolling mechanisms(p.158)
- • Environmental and weather-related risks affecting project timelines(p.173)
- • Competition from larger players in road and bridge construction(p.136)
- • Regulatory and policy changes affecting infrastructure projects(p.286)
- • Dependence on government infrastructure spending and tender allocation(p.286)
- • Competition from established contractors in infrastructure segment(p.300)
- • Volatility in material and labour costs affecting project profitability(p.299)
- • Foreign exchange and interest rate volatility(p.299)
- • Reliance on third-party logistics and transportation(p.286)
Promoters
| Name | Role | Pre-Issue | Post-Issue |
|---|---|---|---|
| Mr. D Prasanna | Promoter | 46.46% | 33.48% |
| Mr. B Venkateshwarlu | Promoter | 31.67% | 22.82% |
| Mr. Vasanth D | Promoter | 2.08% | 1.50% |
| Mrs. D Bhagyavathy | Promoter | 1.04% | 0.75% |
| D Prasanna | Promoter | 46.46% | 33.48% |
| B Venkateshwarlu | Promoter | 31.67% | 22.82% |
| Vasanth D | Promoter | 2.08% | 1.50% |
| D Bhagyavathy | Promoter | 1.04% | 0.75% |
| Gowri Manohari D | Promoter Group | 2.32% | 1.67% |
| Vasumathi Chokkarapu | Promoter Group | 2.93% | 2.11% |
| Mr. D Prasanna | Promoter | 46.46% | 33.48% |
| Mr. B Venkateshwarlu | Promoter | 31.67% | 22.82% |
| Mr. Vasanth D | Promoter | 2.08% | 1.50% |
| Mrs. D Bhagyavathy | Promoter | 1.04% | 0.75% |
| Dhandayuthapani Prasanna | Promoter | 46.46% | — |
| Bollam Venkateshwarlu | Promoter | 31.67% | — |
Leadership
Auto-extracted from the company's RHP using AI, with each fact linked to its source passage (hover any row to see the quote & page). Provided for research only, not investment advice — verify against the official RHP before relying on it.