Godha Cabcon IPO Review: Should you Invest?

Godha Cabcon And Insulation Ltd is one of the leading manufacturers of ACSR Conductor wire, AAAC Conductor and AAC Conductors. The company is based in Madhya Pradesh and was incorporated in 2016. Godha Cabcon IPO is offered in a price band of Rs.30 to Rs.33  a share and has opened on Apr 27th, 2018. The IPO will close on May 3rd, 2018

The company takes up the project of state government and government organizations from State Electricity Board. The company will continue its growth momentum with higher installed capacity and good order book position. The company is also targeting Power Grid Corporation of India Limited to bring its products at national level.

On July 16, 2017 the Godha Cabcon & Insulation was taken over by the company for a total consideration of ₹587.11 Lacs. The company had issued its Equity Shares at par to Mrs. Madhu Godha who is the Sole Proprietor of Godha Cabcon & Insulation and one of the Promoters of the company. The valuation of the concern was equivalent to the capital of the proprietor as on July 15th, 2017.

Key Past Projects of Godha Cabcon

• In the year 2015, the company bagged the tender from Madhya Pradesh Madhya Kshetra Vidyut Vitaran Co. Ltd. (Bhopal) for ₹21 Crorefor AAAC Conductor. Earlier the company had received order for ₹25 Crores and in 2016 the company has further received order for ₹12.5 Crores (extension) due to before time delivery and better quality of products.
• In the year 2017, the company got the order from Madhya Pradesh Poorva Kshetra Vidyut Vitaran Co. Ltd. for ₹12.5 Crore for AAAC Rabbit Conductor.
• In the year 2015, the company got the order from Madhya Pradesh Paschim Kshetra Vidyut Vitaran Co. Ltd (Indore) for ₹35 Crore for AAAC Rabbit conductor.

Purpose of the IPO

The Purpose of the IPO:

1. The company is able to meet the Working Capital Requirements
2. The company is able to meet General Corporate Expenses

Godha Cabcon IPO Details

• Listing At: NSE SME
• Issue Type: Book Built Issue IPO
• Issue Size: 3,000,000 Equity Shares of Rs 10 aggregating up to Rs 9.90 Cr
• Face Value: Rs 10 Per Equity Share
• Market Lot: 4000 Shares
• Minimum Order Quantity: 4000 Shares

Should you Invest?

Godha Cabcon Insulation IPO and the net issue will constitute 27.03% and 25.59% respectively of the post issue paid up equity share capital of the company. As of 31^st March, 2018 the net profit is (0.30) lakhs.

Godha Cabcon IPO is subscribed by 0.12 times as on 30th April 05.00 pm IST. The investors shall only invest in the issue with a long term view as the industry in which the company operates provides lot of opportunities.

 

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