SRM Contractors Limited IPO Details
| IPO Date | Mar 26, 2024, to Mar 28, 2024 |
| Price Band | ₹200 to ₹210 per share |
| Lot Size | 70 Shares |
| Issue Size | ₹130.20 Cr. |
| Allotment Date | 01 April 2024 |
| Listing Date | 03 April 2024 |
SRM Contractors Limited Company Overview
SRM Contractors Limited is a multidisciplinary engineering, construction, and development firm specializing in various civil construction endeavors such as roads, tunnels, slope stabilization, and other related projects. Operating primarily in the challenging terrains of the Union Territories of Jammu & Kashmir and Ladakh, SRM undertakes both independent projects and subcontracting assignments for infrastructure developers.
Registered as a Class A contractor with the Public Work Department of Jammu & Kashmir, SRM Contractors Limited is authorized to bid autonomously on EPC Contracts worth up to Rs. 300 Cr and tunnel construction projects up to Rs. 500 Cr. Since establishment, the company, either independently or through joint ventures, has successfully completed 37 infrastructure projects totaling Rs. 771 Cr, comprising 31 road projects, 3 tunnel projects, 1 slope stabilization project, and 2 miscellaneous civil activities. As of September 15, 2023, the company’s current order book stands at Rs. 707 Cr, encompassing both individual projects and subcontracting endeavors.
Objective of the IPO
Here are a few quick reasons why the company is going public:
- Meeting capital expenditure needs for acquiring equipment/machinery;
- Repaying either fully or partially and prepaying specific outstanding secured borrowings obtained by the company;
- Fulfilling the company’s working capital needs;
- Investing in project-specific joint venture initiatives; and
- Utilization for general corporate purposes.
SRM Contractors Limited Company Financials
| Period Ended | Total Assets | Total Revenue | Profit After Tax | Net Worth | Reserves and Surplus | Borrowing |
| 31-Mar-21 | 112.47 | 161.95 | 8.27 | 26.85 | 25.32 | 31.96 |
| 31-Mar-22 | 120.22 | 265.51 | 17.37 | 44.41 | 42.89 | 31.52 |
| 31-Mar-23 | 137.36 | 300.65 | 18.75 | 63.16 | 46.41 | 47.16 |
Key Performance Indicator
| Market Cap. (Cr.) | 481.83 | EPS (Rs) | 12.24 |
| ROE | 25.02% | Debt/Equity | 0.50 |
| ROCE | 29.43% | P/E | 17.15 |
Pros
- SRM Contractors Limited boasts a proven track record in efficiently executing projects involving roads, tunnels, and slope stabilization within the challenging terrain of Jammu & Kashmir.
- The company strategically selects contracts for multiple projects located in proximity, thereby minimizing transportation costs and optimizing profitability.
- SRM Contractors Limited follows an asset-heavy model, owning all construction equipment and machinery internally, ensuring long-term cost efficiency and expedited project completion.
- Over time, SRM Contractors Limited has vertically integrated its operations, acquiring machinery and technology to carry out construction activities in-house. This includes ownership of various equipment such as boomers, shotcrete machines, excavators, hot mix plants, and compactors.
Cons
- SRM Contractors Limited faces a significant risk due to its primary business concentration in Jammu & Kashmir and Ladakh. This region is susceptible to regional civil unrest, political instability, and adverse climate conditions, among other factors, all of which could substantially impede the company’s operations.
- The company relies heavily on government-awarded projects or those funded by the Government of India, leading to a concentration of revenue sources. This reliance may result in a limited number of available projects in the market or lower profit margins compared to privately funded projects.
- SRM Contractors Limited Contractors must navigate a highly competitive bidding process for infrastructure projects, where factors such as past performance, quality of work, and project costs play crucial roles. The intense competition in this arena poses challenges for the company in securing contracts.
How to Apply for SRM Contractors Limited
1. Go to https://ipo.adityatrading.in/
2. Enter your Client ID
3. Enter the OTP received in your registered mobile number.
4. Choose the IPO and click on the apply button.
5. Enter the UPI ID and quantity and Reduce the price.
6. Click on the submit button
7. Confirm the mandate request received on your phone by entering the UPI PIN.
