SRM Contractors Makes Lukewarm Debut on Stock Market

3 Apr 2024 , 09:51 AM

Jammu & Kashmir-based SRM Contractors made a subdued debut on the stock market, listing at a 7% premium. On the National Stock Exchange (NSE), the shares debuted at ₹215.25, reflecting a premium of 2.50% over the issue price of ₹210. On the Bombay Stock Exchange (BSE), the shares were listed at ₹225, marking a premium of 7.14%.

The company’s ₹130 crore public issue witnessed robust demand, with a subscription rate of 86.57 times during March 26-28. Non-institutional investors (high net-worth individuals) led the subscription, oversubscribing their quota by 214.94 times. Qualified institutional buyers bid 59.59 times the reserved portion, while retail investors subscribed 46.97 times.

SRM Contractors specializes in engineering construction and development, focusing primarily on projects such as roads (including bridges), tunnels, slope stabilization works, and various civil construction activities in the Union Territories of Jammu & Kashmir and Ladakh.

On the financial front, SRM has demonstrated impressive growth, with a 37% CAGR in revenue reaching ₹300.3 Crore in FY23. Net profit also surged at a CAGR of 50.5% during the same period, reaching ₹18.7 Crore in FY23. The EBITDA increased at a CAGR of 52.6% over the last three fiscal years.

For the nine-month period ending September FY24, the company reported a net profit of ₹21.07 Crore on revenue of ₹234.55 Crore, surpassing its FY23 profit numbers within this period.

The ₹130.2-Crore IPO consisted solely of a fresh issue by the company, with a price band set at ₹200-210 per share.