Gujarat-based Rajesh Power Services will open its Rs 160-crore initial share sale for subscription on November 25. This would be the sixth IPO from the SME segment launching in current month despite subdued equity markets mood.
The price band for the public issue has been fixed at Rs 320-335 per share. The institutional investors can participate in the anchor book of the offer for a day on November 22, while the subscription for all kind of investors’ category will be closed on November 27.
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The IPO is a combination of fresh issue of up to 27.9 lakh equity shares (Rs 93.5 lakh crore at the upper price band) and an offer-for-sale of 20 lakh shares (Rs 67 lakh crore) by promoters – Panchal and Patel families.
The solar power generation company has reserved half of the net offer size (total issue size less market maker’s portion) for qualified institutional buyers, 15 percent for non-institutional investors, and the remainder for retail investors.
Retail investors can bid for a minimum and maximum of 400 equity shares amounted to Rs 1.34 lakh at the upper price band, as their investment can not exceed the Rs 2 lakh limit for an IPO.
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Rajesh Power Services offers execution of turnkey projects, operation & maintenance, and consultancy services for power utility companies (both renewable and non-renewable segments). It has an order book of Rs 2,358.2 crore as of March 2024 which is to be executed over the three financial years.
It has invested in HKRP Innovations which provides Internet of Things (IoT) and cloud-based solutions to power grids and renewable energy sector. HKRP provides Smart Feeder Management System (SFMS), Virtual Feeder Segregation (VFS), RTMS for Oil Well, Solar Energy Data Management (SEDM).
The company will spend Rs 25.1 crore out of the net fresh issue proceeds for purchase of cable identification, testing and fault location equipments. setting up of DC solar power plant having capacity of 1300 KW, and in-house development of technical expertise in production of green hydrogen and associated equipment such as electrolysers.
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Furthermore, Rs 30 crore will be utilised for additional working capital requirement, and the remainder for general corporate purpose.
Rajesh Power Services that competes with listed peers like Advait Infratech, Kay cee Energy and Infra, and Viviana Power Tech recorded standalone net profit at Rs 26.02 crore for the year ended March 2024, increasing sharply from Rs 6.75 crore in the previous fiscal 2023. Revenue during the same period jumped significantly to Rs 285 crore, up from Rs 207.2 crore.
In the six months period ended September 2024, standalone profit stood at Rs 27.7 crore on revenue of Rs 313.06 crore.
Isk Advisors is the sole book running lead manager to the issue, while Bigshare Services is the registrar to the offer.
