Indian Stock Market News and Analysis

Maytas Infra is all set tap the capital market via an initial public offer (IPO) of 8,850,000 >equity shares of Rs 10 each. The issue will constitute 15.04% of the fully diluted post-issue equity share capital of the company.

Out of the total, at least 2,655,000 will be available for retail. For qualified institutional buyers (QIBs) at least 5,310,000 will be offered, of which 265,500 equity shares will be avilable for mutual funds and the balance for QIBs.

Price band for the issue is fixed Rs 320 to Rs 370 an equity share. The issue will be open for subscription from Sep. 27, 2007 to Oct. 4, 2007. The equity shares of the company are proposed to be listed on the BSE and the NSE. While DSP Merrill Lynch and JM Financial Consultants are the book running lead managers for the issue, Kotak Mahindra Capital is the co-book running lead managers. Karvy Computershare Private is the registrar to the issu e.

Objective of the Issue

The company intends to allocate the issue proceeds investment in associate companies, purchase of construction equipment, general corporate expenses and issue expenses.

Business Profile

The company is involved in construction and infrastructure development. The business of the company is organised into two parts viz. construction as a contractor on a contract basis and infrastructure development which involves identifying, sourcing, developing, and operating projects in infrastructure sectors.The company is an ISO 9001: 2000 compliant company, historically focused on irrigation, roads and bridges, and building infrastructure sectors. The have completed, and continue to undertake, construction projects in these sectors across 12 states of India.

It recently diversified into civil construction projects in the power, industrial structures, oil and gas infrastruc ture, and railway sectors.

Future Plans

The company is scouting for suitable partners, and positioning themselves for expected opportunities in the water and waste water management, special economic zones, urban infrastructure, ports, and airport sectors as and when viable opportunities
arise. The company believes that their experience, track record, and reputation allows them to secure pre-qualification approvals in a variety of infrastructure sectors in India, either in their own right or as a partner in a joint venture.

Financials

The company`s orderbook, stood at Rs. 35,893.2 million as of Jun. 30, 2007. The company`s contract revenues on a restated unconsolidated basis have grown from Rs 2,037.03 million in fiscal 2004 to Rs 7,876.71 million in fiscal 2007, at a compound annual growth rate (CAGR)  of 57.0% .

The company`s profit after tax increased from Rs. 62.22 million in fi scal 2004 to Rs 550.08 million in fiscal 2007, at a CAGR of 106.8%. This growth is mainly due to an increase in profit from the company`s participation in unincorporated joint ventures that are undertaking larger contracts. All of the company`s revenue to date has been from the construction business. As most of their infrastructure development projects are either in the construction or development phase, and have not yet commenced commercial operation.