The issue of the solid waste management company saw bids for 18,61,250 shares compared with the issue size of 48,20,508 shares amid a broad-based selloff in the market. The price band of the issue is set at Rs 295-Rs 300 per equity share.
The offer includes fresh issue of up to Rs 35 crore worth of equity shares and an offer for sale of up to 5,700,000 shares. The company has already garnered Rs 60.94 crore from 3 anchor investors.
Antony Waste Handling proposes to utilise the net proceeds towards reduction of the consolidated borrowings of the company and general corporate purposes. Further, the company expects that the listing will enhance visibility and brand image and provide liquidity to shareholders.
Analysts said one may subscribe to the issue only for long-term gains. Investors looking for strong listing gains may skip the issue, they said.
“Valuation looks justified, considering the expected growth in earnings over the next few years. Given the positive industry outlook and uptick in revenues from FY20, we recommend ‘Subscribe,’ to the issue with a long-term perspective.
Prabhudas Lilladher has an avoid rating on the issue given highly competitive local markets, national and international players, large dependency on projects from state government authorities, primarily municipal corporations (unstable allocation of MSW management, and rich valuation.
The company counts Municipal Corporation of Greater Mumbai, North Delhi Municipal Corporation, New Okhla Industrial Development Authority, Nagpur Municipal Corporation and the Greater Noida Industrial Development Authority as its clients. The company said it is also currently undertaking a project for Jaypee International Sports.
The profit after tax for fiscal 2017, 2018 and 2019 and the six-month period ended September 30, 2019, were Rs 41.04 crore, Rs 39.88 crore and Rs 34.42 crore and Rs 37.84 crore, respectively.
Equirus Capital is the sole Book Running Lead Manager (BRLM) to the issue.