Transrail Lighting Limited IPO - Detailed ANALYSIS & GMP Today

Summary

Trans Rail Lighting's ₹838 crore IPO is open from 19th to 23rd December, with a price band of ₹10 to ₹32 per share. The company specializes in power transmission, distribution, and infrastructure projects, with operations in 58 countries. It has shown strong revenue and profit growth, but faces risks due to its dependency on government contracts and ongoing legal issues. While the company has a solid track record with 200+ completed projects, the IPO’s valuation and potential risks should be carefully considered before investing.

Takeaways

• 😀 The Trans Rail Lighting IPO will open between December 19 and December 23, 2024, with a price band of ₹10 to ₹32 per share.
• 😀 The total IPO size is ₹838 crore, with ₹400 crore being a fresh issue, offering investors an opportunity to invest in the company.
• 😀 A minimum investment requires applying for 34 shares, costing approximately ₹4688 for one lot.
• 😀 Trans Rail Lighting Ltd. is a leading engineering and construction company specializing in power transmission, infrastructure, and railway services.
• 😀 The company has completed over 200 projects in 58 countries, showing strong global experience and expertise.
• 😀 Over the last three years, the company has shown consistent growth in revenue and profit, with revenue of ₹4130 crore for FY 2023-24 and PAT of ₹233 crore.
• 😀 Despite growth, the company's profit margin is relatively low at 5.65%, which may be a concern for some investors.
• 😀 The company's debt-to-equity ratio stands at 0.56, indicating manageable debt but still worth noting for risk assessment.
• 😀 Trans Rail Lighting relies heavily on government contracts, meaning changes in government priorities or policies could impact revenue.
• 😀 The company's Grey Market Premium (GMP) stands at ₹10, indicating a 28% premium, but this can fluctuate and shouldn't be the sole basis for investment decisions.
• 😀 The IPO proceeds will be used for capital expenditure, general corporate purposes, and offer-for-sale, aiming to fuel future growth and business expansion.

Q & A

What is the size of the Trans Rail Lighting IPO?

The IPO size is ₹838 crore, which includes a fresh issue of around ₹400 crore.

When will the Trans Rail Lighting IPO open and close?

The IPO will open on December 19, 2024, and close on December 23, 2024.

What is the price band of the Trans Rail Lighting IPO?

The price band for the Trans Rail Lighting IPO is ₹10 to ₹32 per share.

What is the lot size for the Trans Rail Lighting IPO?

The lot size for the IPO is 34 shares.

How much should an investor invest in the minimum lot for the Trans Rail Lighting IPO?

The minimum investment for one lot (34 shares) is ₹4,688.

What is the Grey Market Premium (GMP) for the Trans Rail Lighting IPO?

The current GMP is ₹10, which represents a 28% premium over the upper price band of ₹32.

What are the key business areas of Trans Rail Lighting?

Trans Rail Lighting operates in power transmission and distribution, manufacturing and supplying poles and lights, providing EPC services for bridges and tunnels, and offering railway infrastructure services.

What has been the financial performance of Trans Rail Lighting in recent years?

The company has shown consistent growth, with revenue increasing to ₹4,130 crore in FY 2024 and a 116% increase in profit after tax (PAT), reaching ₹233 crore.

What are the major risks associated with investing in the Trans Rail Lighting IPO?

Some key risks include long execution periods for projects, dependency on government contracts, ongoing legal proceedings, and exposure to international market risks.

What is the company’s debt situation, and how does it compare to its equity?

Trans Rail Lighting has a debt of ₹303 crore as of June 2024, with a debt-to-equity ratio of 0.56, which indicates that the debt level is manageable.

Why is the Trans Rail Lighting IPO considered a small-cap company?

The company has a market capitalization of ₹5,799 crore, classifying it as a small-cap company. Small-cap companies are typically characterized by higher growth potential but also higher risk.

What is the main objective behind the funds raised through the Trans Rail Lighting IPO?

The primary objective is to fund capital expenditure (Capex) for business expansion, while the secondary objective is for general corporate purposes and Offer for Sale (OFS).

What is the company's global presence and project experience?

Trans Rail Lighting has completed over 200 projects across 58 countries, showcasing its vast international experience.