Pratham EPC Projects IPO Review & Fundamental Analysis
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Pratham EPC Projects IPO

Pratham EPC Projects Limited’s IPO consists of a fresh issue of 48,00,000 shares aggregating to INR 36.00 crores. The company plans to utilize net proceeds to purchase new machinery and meet the working cycle requirement. 

Pratham EPC Projects Ltd IPO – Important Details

Pratham EPC IPO DateMarch 11, 2024 to March 13, 2024
Pratham EPC IPO Listing DateMarch 18, 2024
Pratham EPC IPO PriceINR 71 to 75 per share
Pratham EPC IPO Lot Size1600 Shares
Pratham EPC IPO Total Issue SizeINR 36.00 crores
Pratham EPC IPO Basis of AllotmentMarch 14, 2024
Pratham EPC IPO Initiation of RefundsMarch 12, 2024
Pratham EPC IPO Credit of Shares to DematMarch 15, 2024
Pratham EPC IPO Issue TypeBook Built Issue IPO
Pratham EPC IPO Listing AtNSE SME

Pratham EPC IPO – Company Profile

Based in Ahmedabad, Pratham EPC Projects Limited is an integrated engineering, procurement, construction, and commissioning company in the business of end-to-end service providers to Oil & Gas distribution companies in India. Founded by visionary Promoters Mr. Pratikkumar Maganlal Vekariya and Mr. Nayankumar Manubhai Pansuriya, have a combined experience of over 30 years in the engineering industry.

The company has an Oil & Gas pipeline infrastructure service provider in India, focused on laying pipeline networks along with the construction of associated facilities and providing Operations & Maintenance services to the City Gas Distribution (“CGD”) Companies in India. The company has an integrated EPC company offering a diversified range of pipeline and allied services for the oil & gas industry. 

The company derives revenue from the following two business verticals: 

a) Gas & Oil Pipeline Projects 

b) Water Pipeline Projects

Pratham EPC Projects Limited IPO  – Fundamental Analysis

Pratham EPC Projects Ltd’s IPO financials depict steady revenue, significant profit growth, and strong equity increases, highlighting its potential as a robust investment in the EPC sector, despite increased leverage, showcasing operational efficiency and market resilience.

Revenue Stability:

The company’s revenue has shown a slight decrease in FY2023 compared to FY2022, but overall, it demonstrates growth from FY2021, indicating resilience and stable market demand for its services.

Equity Growth:

Equity has seen a significant increase, more than tripling from FY2021 to FY2023, reflecting strong investor confidence and possibly successful reinvestment strategies to support further growth.

Profitability:

Profit after tax has shown remarkable growth, indicating the company’s increasing operational efficiency and profitability. The jump to ₹1,017.04 lakhs in FY2023 underscores its growing financial health.

Return on Net Worth (RoNW):

The RoNW remains impressively high at 42.50% in FY2023, slightly down from FY2022, demonstrating the company’s efficient profit generation from shareholders’ equity.

Diluted EPS:

The Diluted EPS has significantly increased, highlighting the company’s growing earnings power per share, which is beneficial for investors.

Asset and Liability Management:

Total assets have more than doubled, indicating business expansion and investment in operational capacity. The increase in liabilities suggests leveraging but is proportionate to the asset growth.

Debt to Equity Ratio:

The debt to equity ratio has increased in FY2023 to 0.79, indicating higher leverage which could pose increased financial risk but also reflects investment in growth.

Inventory Turnover Ratio:

A drastic improvement in inventory turnover indicates more efficient management and faster conversion into revenue, which is critical for operational efficiency.

Net Profit Ratio:

The net profit ratio’s increase to 15.22% in FY2023 highlights the company’s growing profitability relative to its size, which is a positive sign for potential investors.

Current Ratio:

The current ratio shows a stable liquidity position, ensuring the company can cover its short-term obligations.

Pratham EPC Projects Ltd IPO Financial Information

ParticularAs of 31 March 2021As of 31 March 2022As of 31 March 2023
Revenue (₹ in lakhs)3,058.23 5,046.845,020.35
Equity (₹ in lakhs)592.411,033.731,797.86
Expenses (₹ in lakhs)2,933.504,473.334,150.25
Profit and Loss After Tax (₹ in lakhs)151.53589.331,017.04
RoNW (%)19.05%42.69%42.50%
Diluted EPS only (₹)0.873.415.90
NAV per Equity Share (₹)4.577.9813.87
Total Assets (in lakhs)2,041.932,850.174,849.75
Total Liabilities (in lakhs) 1,449.521,816.443,051.89
Debt to Equity Ratio (in times)0.340.240.79
Inventory Turnover Ratio (in days)98.8940.9610.51
Net Profit Ratio (in %)3.698.7415.22
Current Ratio (in times) 1.101.281.21

Pratham EPC Projects Limited IPO Peer Comparison

Pratham EPC Projects Limited, with revenue of ₹5,020.35 lakhs and a RoNW of 42.50%, demonstrates exceptional profitability and operational efficiency compared to Likhitha Infrastructure, which shows higher revenue but lower RoNW and EPS, highlighting Pratham’s strong financial health and growth potential.

CompanyTotal Revenue (₹ in lakhs)P/E Ratio (Times)EPS (Basic) (₹)RoNW (%)NAV per Equity Share (Basic) (₹)
Pratham EPC Projects Limited5,020.35NA5.9042.50%13.87
Likhitha Infrastructure Limited35,076.61 15.4715.2224.01%63.39

Pratham EPC Projects IPO Objective

The main objectives of Pratham EPC’s IPO is to purchase advanced machinery (INR 8.83 crores) to enhance infrastructural development capabilities and to meet capital-intensive working capital needs (INR 15.15 crores).

  1. To purchase machinery: The company tends to invest in the latest equipment and technology, wherever necessary. To increase the equipment fleet, the company intends to purchase the latest machinery from reputed manufacturers and continue with the strategy of placing minimum reliance on hired or leased machinery. Accordingly, the company proposes to utilize INR 8.83 crores towards the purchase of XZ3600 to strengthen its core Infrastructural Development capabilities.
  1. To meet working capital requirements: The business of the company is capital intensive, and to meet the working capital requirement, the company plans to utilize INR 15.15 crores from the raised funds. 

Pratham EPC IPO Risks And Challenges

The company’s risk includes outstanding legal proceedings that could adversely affect business and financial conditions. Failure to meet client standards may lead to loss of business or compensation. Dependency on a few large customers poses revenue and profitability risks.

  1. There are outstanding legal proceedings involving the company. Any adverse decision in such proceedings may have a material adverse effect on the business, results of operations, and financial condition.
  1. The failure to perform in accordance with the standards prescribed in the client’s work order could result in loss of business or compensation payment.
  1. The Company is dependent on a few customers for sales. The loss of any of these large customers may affect revenues and profitability. 

Pratham EPC Projects Limited IPO  – Industry & Market Potential

As of April 2022, India’s oil refining capacity stood at 251.21 million metric tonnes per annum (MMTPA), making it the second-largest refiner in Asia and the fourth-largest in the world. Private companies owned about 35% of the total refining capacity. India is planning to double its refining capacity to 450-500 million tonnes by 2030.

India aims to commercialize 50% of its SPR (strategic petroleum reserves) to raise funds and build additional storage tanks to offset high oil prices. In September 2021, the Indian government approved oil and gas projects worth Rs. 1 lakh crore (US$ 13.46 billion) in Northeast India. 

These projects are expected to be completed by 2025. In February 2021, Prime Minister Mr. Narendra Modi announced that the Government of India plans to invest Rs. 7.5 trillion (US$ 102.49 billion) on oil and gas infrastructure in the next five years.

Pratham EPC Projects Ltd IPO – Type of Offer

Pratham EPC Projects Limited’s IPO consists of a fresh issue of 48,00,000 shares aggregating to INR 36.00 crores. The company plans to utilize net proceeds to purchase new machinery and meet the working cycle requirement. 

Pratham EPC IPO Offer Size

The offer size of Pratham EPC Limited’s IPO is  INR 36.00 crores. The company plans to utilize net proceeds to purchase new machinery and meet the working cycle requirement. 

Pratham EPC Projects Limited IPO Allotment Structure

Pratham EPC’s allocation will be as follows: 50% for Qualified Institutional Buyers (QIB), 15% for Non-Institutional Investors (NII), and 10% for Retail Individual Investors (RII) according to SEBI regulations. A portion of the issue is reserved for market makers.

Qualified Institutional Buyers (QIB): As per SEBI regulations, 50% of the shares offered through the IPO will be reserved for Qualified Institutional Buyers, 15% for Non-Insitutional Buyers, and 35% for Retail Individuals. These include entities such as banks, mutual funds, and insurance companies.

Non-Institutional Investors (NII): 15% of the shares will be reserved for Non-Institutional Investors. These typically include corporate bodies or individuals investing more than Rs.2 lakhs.

Retail Individual Investors (RII): The remaining 35% of the shares will be allotted to Retail Individual Investors. These individual investors apply for shares with a total value of less than Rs.2 lakhs. 

Market Marker Reservations: A portion of the issue up to 5% of the issue, i.e., 2,40,000 shares, are reserved for the market makers. 

How to apply for a Pratham EPC Projects Ltd IPO?

To apply for the Pratham EPC IPO through Alice Blue, you would typically follow these steps:

  1. Open a Demat and Trading Account: If you don’t have one already, you would need to open a Demat and trading account with Alice Blue.
  2. Check for IPO Details: Once your account is active, you can check for the Pratham EPC  IPO details in the IPO section of the Alice Blue platform.
  3.  Place the Bid: Enter the number of shares you wish to buy and place your bid within the IPO’s price band.
  4. Submit the Application: Confirm all your details and submit your application.

You can apply for the Pratham EPC IPO at Alice Blue in just a few clicks!

Check Allotment Status: After the allotment process, you can check the allotment status to see if you have received any shares.

Please note that the allotment of shares is not guaranteed and will depend on the demand for the IPO.

How do you check Pratham EPC IPO Allotment Status?

Checking the allotment status of an IPO in Alice Blue is usually straightforward. Please follow these general steps:

  1. Log in to your Alice Blue Account: You can do this through the