BCPL Railway Infrastructure Limited IPO

Apply 1
Avoid 0

(i) Kolkata based BCPL Railway Infrastructure Limited (BRIL) was Incorporated in 1995. BCPL Railway is engaged in the field of Railway Infrastructure Development involving Design, Drawing, Supply, Erection, and Commissioning of 25KV, 50Hz Single Phase Traction Overhead Equipment.

(ii) The key clients of the company include various zones of the Indian Railways like Eastern Railway, South Eastern Railway, South East Central Railway, Northern Railway, East Coast Railway, North Frontier Railway, East Central Railway, Central Organisation For Railway Electrification (CORE) as well as large Public and Private Sector Undertakings like RITES Ltd., Durgapur Projects Ltd., Essel Mining Industries Ltd., Adhunik Group, Usha Martin Industries Ltd, Jindal Steel and Power Ltd., Rungta Mines, Haldia Energy Limited, Electrosteel and many more.

(iii) The company started its business as a Civil Contractor for the Indian Railways but diversified into electrification in the middle of the 90’s. Ever since the company has kept its focus on the Electrification sector of the Railways keeping in view the vast scope of work in the existing and the untapped areas.

(iv)The total Revenues of the company stood at Rs 50.63 Cr, Rs 34.98 Cr and Rs 25.73 Cr for the fiscal year 2018, 2017 and 2016 respectively. The PAT was Rs 4.04 Cr, Rs 1.27 Cr and Rs .96 Cr for the fiscal year 2018, 2017 and 2016 respectively.

Objects of the BCPL Railway Infrastructure Limited IPO:

Objective of BCPL Railway Infrastructure IPO are: (i) The Issue consists of a Fresh issue of 42,00,000 Equity Shares. (ii) An OFS of up to 6,60,000 Equity Shares by the Selling Shareholders of the Company. (iii) The objects of the fresh issue are to raise funds to meet the working capital requirements of the company

BCPL Railway Infrastructure Limited IPO Details:

Open Date: Oct 05 2018
Close Date: Oct 19 2018
Total Shares: 4,860,000
Face Value: ₹ 10 Per Equity Share
Issue Size: 17.01 Cr.
Lot Size: 4000 Shares
Issue Price: ₹ 35 Per Equity Share
Listing At: BSE SME
Listing Date: Oct 29 2018

Promoters And Management:

Promoters of BCPL Railway Infrastructure IPO Company are: (i) Mr Jayanta Kumar Ghosh (ii) Mr Uday Narayan Singh (iii) Mr Aparesh Nandi (iv) Resilient Exports Pvt Ltd.

Financials of BCPL Railway Infrastructure Limited IPO:

Particulars For the year/period ended (in Rs Lacs)
31-Mar-2018 31-Mar-17 31-Mar-16 31-Mar-15 31-Mar-14
Total Assets 5,148.71 4,837.37 5,205.26 4,821.54 4,330.37
Total Revenue 5,063.59 3,498.76 2,573.92 5,552.78 3,208.67
Profit After Tax 404.55 127.20 96.11 326.91 206.83

Comparison With Peers:

There is no peer to compare with as per DRHP.

Recommendation on BCPL Railway Infrastructure Limited IPO:

Review and Recommendation of BCPL Railway Infrastructure IPO from IZ team is : 4/10 [The issue is priced at a reasonable valuation. The company has a strong Balance Sheet. They have a lean FY2015-16 where their revenue has dipped considerably. However, the company has maintained good revenue growth from thereon. The main problem is a difficult market condition, the business of the company is highly competitive, and plus a lot of litigation is pending against the company and their group companies.]

Lead Manager of BCPL Railway Infrastructure Limited IPO:

  1. Gretex Corporate Services Private Limited

Registrar of BCPL Railway Infrastructure Limited IPO:

  1. Bigshare Services Private Limited

Company Address:

BCPL Railway Infrastructure Limited 112, Raja Ram Mohan Roy Sarani Kolkata - 700 009 Phone: +91 33 2219 0085 Email: corp@bcril.com Website: www.bcril.com

Bid Details of BCPL Railway Infrastructure Limited IPO as on
19 Oct 2018 | 11:58:01 PM

Category No.of shares offered No. of shares bid
2,304,000 4,976,000
2,304,000 1,116,000
252,000 252,000
4,860,000 6,344,000
QIBs No
QIBs+HNIs Subscription 2.16X
Retail Subscription 0.48X
Total Subscription 1.32X

Discussion on BCPL Railway Infrastructure Limited IPO:

    Listing review – BCPL Railway Infrastructure listed today +2.86%..

    Based on the subscription figure this IPO can be a good candidate for listing gains.

    The Company has ROE of 10% and ROCE of 19.3% in FY18.

    The Company has a strong Balance Sheet.

    1. Debt/EQuity almost negligible.
    2. Current Ratio >4 (ideally should be greater than 1.5)
    3. Quick Ratio > 2(ideally should be greater than 1)
    4. The Long-term debt is reducing year by year.
    5. The Company has manageable Receivable days of 55 in 2018.

    As per management,
    The Company has a setback in the year 2015-16 due to a decrease in operational activity of the company.

    RISK in the Company,

    (i) As per DRHP Their Group entity, D.S Engineering in which the promoters have an interest is doing the same business as BCPL Railways. So in future, there is no guarantee that conflict will not arise in distributing the business among the companies.

    (ii) The business in which the Company operates is highly competitive where the competition is very tough from organized and unorganized players.

    Valuation of the Company- Cheap or Costly?

    (i) PAT=4.04 Cr
    (ii) Outstanding Shares= 1.7236 Cr
    (iii) EPS=2.34
    (iv) P/E=15
    (v) EV= 61 Cr
    (vi) EBITDA= 7.28 Cr
    (vii) EV/EBITDA=8.34
    (viii) Mcap/Sales=1.2

    Conclusion: The Company has reasonable valuations.

    Debt Story of the Company based on FY18 financials:

    (i) Long-term= 58.91 Lakh
    (ii) Short-term= 8.27 Cr
    (iii) Equity= 37.29 Cr
    (iv) D/E= 0.23

    Conclusion: The Company has almost debt free. The Long-term borrowing has also reduced significantly in the last 3 years from 3.54 Cr in FY16 to 58.91 Lakh in FY18.

    It is a mix issue
    Fresh Shares= 42 Lakh
    OFS=6.60 Lakh

    The List of Shareholders offering shares via this IPO

    Name ————–No.of Shares heldNo. of Shares Offered
    1. Jayanta Kumar Ghosh ———————– 15,29,006 ———————– 1,65,000
    2. Apresh Nandi ———————– 1484574 ———————– 1,65,000
    3. Uday Narayan Singh ———————– 491054 ———————– 1,65,000
    4. Kanhai Singh ———————– 2850152———————– 1,65,000

    (i) The Company has an Excellent record of Project Execution.
    (ii) The Company has experienced Promoters and Management.
    (iii) They have satisfied chains of vendors.

    As per DRHP, no listed peer is available for comparison.

    Current Projects of the company

    1. 25 KV A.C., Single phase, 50 Hz, Traction Overhead Electrification Work in Khana.

    2. 132/25kV Traction Substation work at Rampurhat and Dubrajpur in Khana.

    3. Design, Supply, Erection, Testing & Commissioning of 25 KV, 50 Hz, Single Phase, Electrification Works.

    4. Design, Supply, Erection, Testing & Commissioning of 25 KV, 50 Hz, AC Single Phase Overhead Equipment works in Garwa Road (Excl.)

    and many more, the complete list can be accessed at http://www.bcril.com/CurrentProjects.php

    Conclusion: The Company has a very good list of projects in their kitty.