Kay Cee Energy and Infra Ltd IPO - Key Details You Need to Know
About the Company
Kay Cee Energy and Infra Ltd provides specialized services for commissioning and constructing power transmission and distribution systems for various private and government authorities. It’s an EPC (engineering, procurement, and construction) company with 25 years of experience, and its services include transmission lines towers, underground cable EHV, monopole, and substations.
IPO Details
With an issue size of Rs 15.93 crore in its IPO, Kay Cee Energy and Infra will offer 2,950,000 shares. Here are some of the other vital details of this IPO:
| IPO Subscription Opens On | 28 December 2023 |
|---|---|
IPO Subscription Ends On | 2 January 2024 |
Lot Size | 2000 and in multiples thereof |
Issue Price | Rs 51 - 54 |
Listing On | NSE |
Face Value | Rs 10 |
50% of the shares in the IPO are for qualified institutional buyers, 15% are for non-institutional buyers, and 35% are reserved for retail investors. The company aims to fund its working capital requirements and address general corporate purposes with the proceeds received.
Financial Snapshot
The company recorded a healthy revenue growth between FY 22 and FY 23. Between these two fiscals, its revenue grew by 22.33%, and profit after tax (PAT) increased by 77.62%. Some of the other key financial details of the company for FY 23 are as follows:
| Revenue From Operations | Rs 6,109.18 lakhs |
|---|---|
Profit After Tax | Rs 550.71 lakhs |
Total Assets | Rs 8,017.57 lakhs |
Return on Net Worth | 25.13% |
Earnings Per Share | 220.28 |
Strengths and Risks
Here are the key strengths of the company:
Strong Order Book of Supply from Public and Private Sector Units
Owing to its high technical expertise and a team of specialized engineers, the company enjoys a solid and long-standing customer base from well-known PSUs and private sector units such as Rajasthan Rajya Vidyut Prasaran Nigam Limited, Gawar Construction Limited, Larsen & Toubro Limited, Sadbhav Engineering Limited, etc.
Strong Execution Capabilities and Rich Industry Experience
The company boasts of an in-house design and engineering team with a fleet of modern machinery and skilled manpower capable of executing projects promptly. As of September 30, 2023, the company has 15 in-hand projects with an aggregate order book value of approximately Rs 54,990.27 lakhs.
Experienced Management Team
The company’s management team is well-experienced and qualified in handling and execution of large-scale power transmission EPC projects. With its rich experience, the company has achieved high levels of client satisfaction.
Risks
The associated risks are as follows:
- Revenues are largely dependent on bids accepted by the Government and other agencies
- EPC activity is highly capital-intensive
- Majority of revenues coming from top five customers
- Revenues are highly dependent on operations from Rajasthan
- Outstanding legal proceedings
How to Apply for the IPO?
If you want to apply for this IPO, you can easily do so with Kotak Securities. All you need to do is:
- Login into your Demat account and visit the IPO section
- Feed in the IPO details, specify the number of lots and give your application price
- Enter your UPI ID and click on submit to place your bid
- Upon doing so, you will get a notification on your UPI ID to block funds
- Upon approval, your funds get blocked
Summing it Up
For infrastructure development, power is a critical component. For sustained growth of the Indian economy, the development of adequate power infrastructure is essential. India's installed power capacity increased from 356 GW in FY 2019 to 416 GW in FY 23, and the country is the world's third-largest energy producer. Going ahead, the power demand in the country is expected to rise with a CAGR of 4.5% between FY 24 and FY 27.
The Government of India has also undertaken several initiatives to boost meeting peak power demand in the country. These developments surrounding the power sector position Kay Cee Energy and Infra Ltd to benefit in the coming days, and investing in its shares can help you grow your wealth. However, you need to be careful about valuations and have a holistic understanding of your risk appetite. Go through the company's red herring prospectus to know the risk factors and ensure you are comfortable with them.
