Ceigall India to raise ₹1,253 cr via IPO; fixes price band at ₹380-401 a share

Infrastructure construction firm Ceigall India has set price band at ₹380-401 per share for its upcoming initial public offering (IPO), which will open for subscription on August 1, 2024. This week is going to be busy for the primary market as the highly-awaited IPO of Ola Electric will also open for bidding on August 2, while the ₹1,857 crore-issue of Delhi-based Akums Drugs and Pharmaceuticals will begin on July 30.

The three-day IPO of Ceigall will close on August 5, while the anchor bidding will start on July 31, a day ahead of opening of the issue. The tentative date for listing of shares of Ceigall India on the BSE and NSE is August 8.

The issue is a mix of fresh issuance of equity shares worth ₹684.3 crore and an offer for sale (OFS) of 1,41,74,840 equity shares of face value of ₹5 each by existing shareholders including promoters. At the upper end of the price band, OFS amount will be ₹568.41 crore, taking the total issue size to ₹1,253 crore.

Under the OFS, promoters Ramneek Sehgal, Ramneek Sehgal and Sons HUF, Avneet Luthra, Mohinder Pal Singh Sehgal, Parmjit Sehgal, and Simran Sehgal will be selling shares.

The Ludhiana-based construction company has reserved half of the issue for qualified institutional buyers, 15% for non-institutional bidders, and the remaining 35% for retail investors, as per DRHP document.

Out of proposed ₹684.3 crore fundraise from fresh equities, the company intends to use ₹99.79 crore for purchase of equipment; ₹413.4 crore for repayment of loans availed by the company and its subsidiary, CIPPL. The remaining fund will be used to meet general corporate purposes.

Established in 2002, Ceigall India has completed over 34 projects across ten states in India with experience in specialised structural work such as elevated roads, flyovers, bridges, railway overbridges, tunnels, highways, metros, expressways and runways. It is among the fastest growing engineering, procurement and construction (EPC) company and has grown at a CAGR of 50.13% between fiscals 2022 to 2024. Its principal business operations are broadly divided into EPC projects and hybrid annuity model (HAM) projects, spread across over tenstates in India. As on June 30, 2024, the company's order book stood at ₹9,470.84 crore.

The company has completed over 34 projects, including 16 EPC, one HAM, five O&M and 12 Item Rate Projects, in the roads and highways sector. Currently, it has 18 ongoing projects, including 13 EPC projects and five HAM projects which includes elevated corridors, bridges, flyovers, rail over-bridges, tunnels, expressway, runway, metro projects and multi-lane highways.

For the financial year 2023-24, Ceigall reported 46.48% growth in revenue from operations at ₹3,029.35 crore from ₹2,068.16 crore in the year ago period. The profit nearly doubled to ₹304.3 crore in the fiscal 2024 from ₹167.2 crore in the previous fiscal.

ICICI Securities Limited, IIFL Securities Limited, and JM Financial Limited are the book running lead managers and Link Intime India Private Limited is the registrar to the offer. The equity shares are proposed to be listed on BSE and NSE.