Chavda Infra IPO (NSE SME) Overview

Chavda Infra IPO entails to raise to ₹43.26 Cr and comprises entirely of a fresh issue of equity shares. Chavda Infra Limited, is a construction company based in Ahmedabad, Gujarat and is engaged in the business of civil construction of residential and commercial projects

IPO opensSep 12, 2023
IPO ClosesSep 14, 2023
IPO Size (Rs.)  ₹43.26 Cr
IPO Size (shares)66,56,000
Breakuponly Fresh issue
Face Value:₹ 10
IPO Price in Rs :₹60 to ₹65 per share
Minimum Lot2000 Shares
Listing AtNSE SME
Market maker5.05%
Anchor quota28.49%
QIB Quota18.99%
NII Quota14.24%
Retail Quota33.23%
 Lead ManagerBeeline Capital Advisors
RegistrarKfin Technologies
Market makerSpread X Securities

About Chavda Infra Limited:

  • It was incorporated in 2012 and has over 30 years of experience in the construction industry and is engaged in the business of civil construction of residential and commercial projects.
  • The company has successfully executed more than 100 projects worth ₹ 67,099.45 Lakhs.
  • Chavda Infra Ltd has been promoted by Mahesh Chavda, Dharmishta Chavda and Johil Chavda.
  • It has a team of over 217 technical staff and generates revenue from three business verticals.
  • It currently has about 26 ongoing projects at various stages of completion with a combined marketable value of more than ₹600 crore. These 26 projects include 4 commercial property projects, 4 institutional infrastructure projects and the majority 18 residential projects
  • We derive our revenue from following three business verticals:
    • a) Contracting Services
    • b) Development Services
    • c) Commercial Renting Services

Financials: Chavda Infra IPO

Particulars / Rs LacsFYE23FYE22FYE21
Revenue from operations16,188.5710,982.249,123.79
PBT1,677.95732.55607.35
Profit After Tax1,204.62521.46443.84
Share Capital1,800.00150150
Net worth3,040.361,835.741,314.28
Earnings Per Share –6.692.92.47
NAV16.8910.27.3
Total Borrowings5,328.954,993.143,330.32
Post issue Share Capital2,465
FV10.0
IPO price65.0
EPS Fy234.9
PE Fy2313.3
Market cap in Lacs16,022.5
Market Cap/sales1.0

Anchor Investors:

Chavda Infra IPO: Salient Points

  • The promoter holding (including promoter group) in the company currently stands at 100%. and will get diluted to 73% post the IPO.
  • 100% of its revenue comes from the state of Gujarat i.e. in Ahmedabad and Rajkot.
  • Some of the highly acclaimed projects completed by Chavda Infra in Ahmedabad include Straft Luxuria, Shivalik Parkview, Shivalik Sharda Harmony among key residential projects.
  • The commercial properties developed include AAA Corporate House, Sadbhav House, Solitaire Sky, Sandesh Press, Suyash Solitaire and Solitaire Connect. Some of its premium projects include the Nirma University (old building), Zydus School and AIS Toddlers Den.
  • It provides services across the construction value chain, ranging from planning and design to construction and post-construction activities to our clients
  • As of May 31, 2023, Company had 26 on-going projects worth approximately ₹ 60,139 lakhs, suggesting our strong order book. Out of 26 on-going projects 4 are commercial Projects, 4 are institutional projects and 18 are residential projects.
  • Chavda Infra IPOs coming at a PE ratio of 13-14x (fy23 earnings).
  • Company has posted steady growth in its top line and bottom line.
  • The company has shown PSP Projects, and Ahluwalia Contracts as listed peers. They are much larger companies and are trading at a P/E of 20.4 and 22.9x respectively.
  • I intend to apply in Chavda Infra IPO subject to availability of funds. Issue looks reasonably priced. The key risk remains from any overall significant market meltdown.
  • This is a mid sized SME issue.
  • GMP as reported on social media has been around Rs. 50.
  • The lead book running manager is Beeline Capital Advisors. The IPOs lead managed by them have given a good return to the investors. These include names like Vinsys IT Services Limited, Ahasolar Technologies, Pentagon Rubber, Remus Pharmaceuticals, Sotac Pharmaceuticals, RBM Infracon Limited, Transvoy Logistics, Dev Labtech, Viviana Power Tech, Vital Chemtech, Aristo Bio-Tech and Lifescience, Viaz Tyres, Vertexplus Technologies etc.
  • SME IPO are quite illiquid and volatile and exit options sometimes is delayed.

Standard disclaimer: I am not a SEBI registered analyst and above analysis is for educational purpose only. Iam a postgraduate in engineering & Management . Also Certified in some exams like NISM-Series-V-A: Mutual Fund Distributors Certification, NISM-Series-X-A: Investment Adviser (Level 1) Certification and NISM-Series-X-B: Investment Adviser (Level 2) Examination. This post is my view on the subject matter and is only academic and exploratory in nature. It is not meant to influence investment decisions of investors. I may have bias/vested interest in covered Stock/Mutual Funds/NCD etc. due to my own investment or leaning. Further my understanding of the areas on which I write may be imperfect or incomplete and data could be wrong due to limited time and resources at my disposal. Do check the data from company’s RHP and exchanges before making any decision. Please do your own due diligence as stock market/MF investments have high degree of inherent risk.

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