Mumbai-based Konstelec Engineers Limited (KEL), a prominent player in the electrical Engineering, Procurement, and Construction (EPC) services sector, has announced its plans to raise approximately Rs. 25 crores through an Initial Public Offering (IPO). The company aims to be listed on NSE Emerge, with the IPO scheduled for January this year. This strategic move is set to propel KEL into a new phase of growth and expansion.
The IPO comprises a fresh issue of up to 41 lakh equity shares, each with a face value of Rs. 10, at the book-build price. The company has submitted its Draft Red Herring Prospectus (DRHP) to the Securities and Exchange Board of India (SEBI). Beeline Capital Advisors Private Limited has been appointed as the Book Running Lead Manager for the IPO, and Skyline Financial Services Private Limited will act as the registrar of the issue.
The primary utilization of the raised funds will be directed towards meeting working capital requirements for ongoing and upcoming long-term projects. A significant portion will also be allocated for procuring high-quality products essential for project execution, providing collateral security, and the remaining funds will support general corporate purposes and public-issue expenses.
A Strong Foundation: Order Book and Clientele
Konstelec Engineers Limited boasts a robust order book, with over 50 major projects valued at around Rs. 565 crores currently in various phases of implementation across India and abroad. The clientele of KEL reads like a who’s who of corporate giants, including Reliance Industries Limited, Engineers India Limited, JSW Steel, Indian Oil, BPCL, HPCL, CPCL, MRPL, ISRO, ACC, BARC, Dangote Industries Limited, Adani, NTPC, Tata Steel Limited, Navin Fluorine International Ltd., and IGPL, among others.
The company specializes in providing comprehensive engineering services for electrical infrastructure projects, including instrumentation and automation, catering to diverse industries such as oil & gas, refineries, steel, cement, pharmaceuticals, textiles, hospitals, and healthcare.
Purposeful Utilization of Funds
Speaking about the company’s decision to go public, Mr. Biharilal Ravilal Shah, Chairman-cum-Managing Director of Konstelec Engineers Limited, highlighted the company’s commitment to delivering high-quality, safe, and innovative solutions. He mentioned, “Our combined experience of over six decades in this space, combined with the expertise of our exceptionally professional team, has driven our business beyond boundaries.”
The funds raised from the IPO will play a pivotal role in fulfilling working capital requirements for long-term projects, enabling KEL to continue its operations seamlessly in both domestic and international markets.
Financial Performance and Growth Trajectory
In the fiscal year 2022-23, KEL demonstrated commendable financial performance. Operating revenue surged to Rs. 153.40 crore, up from Rs. 107.05 crore in the previous fiscal year. The company witnessed substantial growth in Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA), which increased from Rs. 5.84 crore in FY 2021-22 to Rs. 14.15 crore in FY 2022-23.
Profit After Tax (PAT) recorded an impressive over two-fold growth, reaching Rs. 7.78 crore in FY 2022-23, compared to Rs. 3.52 crore in FY 2021-22. These financial indicators underscore KEL’s ability to navigate challenges, maintain operational excellence, and achieve sustained growth.
As Konstelec Engineers Limited prepares to embark on this exciting journey towards an IPO, the industry and investors alike are keenly watching, anticipating further success and contributions from this stalwart in the electrical EPC services domain.
