BGR Energy IPO Analysis : Subscribe to BGR Energy IPO
BGR Energy IPO Analysis : Subscribe to BGR Energy IPO
Pranav Securities (P-sec) has come out with report on BGR Energy Systems IPO. The firm has recommended to subscribe the issue.
BGR Energy Systems, a supplier of systems and equipment for the power, oil & gas, refinery, petrochemical and process industries, proposes to enter the capital markets on December 5, 2007 with a public issue of 9,136,000 equity shares of Rs 10 each through 100% book building process.
Pranav Securities report on BGR Energy Systems IPO
BGR Energy Systems offers products and solutions for the supply of systems & equipment as well as turnkey engineering project contracting catering to the power, oil & gas, refinery and petrochemical industries.
The company clocked a CAGR of 50.5% for the topline and 50.6% for the bottomline over FY02-07. The company’s margins have been improving from 9.2% in FY03 to 11.06% in FY07 (18 mths).
The company’s current order backlog stands at Rs 33.2 billion with 76% coming in from the power project business.
BGR intends to raise money in order to expand its production facilities in India, China and Middle East as well as fund its working capital and general corporate r equirements.
The issue is priced at 104.42x FY07 and 117.91x FY07 on lower and upper price band respectively. Though a bit expensive we are robust on the industry and believe the company will sustain its growth trend. We recommend Subscribe.
