ARSS Infrastructure Projects ends with 64% premium

At 736.30 on the BSE

ARSS Infrastructure Projects ended at Rs 736.30 on the BSE, a 63.60% premium over the initial public offer price of Rs 450.

The stock debuted at Rs 640, a 42.2% premium over the initial public offer (IPO) price. On BSE, 1.15 crore shares were traded on the counter. The stock hit a high of Rs 754.70 and a low of Rs 640.

The current share price of Rs 736.30, discounts the company's year ended March 2009 EPS of Rs 34.4 by a PE multiple of 21.40.

ARSS Infrastructure Projects had raised Rs 113.04 crore through its recently concluded IPO that ended on 11 February 2010 with an over subscription of 47.62 times. The IPO, which opened on 8 February 2010, had a price band of Rs 410 to Rs 450 per share.

Foreign institutional investors (FIIs) put in bids for 4.48 crore shares compared with 15.07 lakh shares reserved for the qualified institutional buyers (QIB) category as a whole. The non-institutional investors segment, comprising of high networth individuals and corporates was bid a staggering 124.5 times. The retail investors' segment was bid 18.5 times.

The company will use the issue proceeds for investment in joint ventures and funding long term working capital requirement.

ARSS Infrastructure Projects (AIPL) provides construction services for railway infrastructure, roads & highways and irrigation projects. The company has successfully executed over 86 projects involving construction of over 200 kilometer (km) of railway tracks. Besides rail projects, AIPL is also into construction of roads and highways and irrigation projects.

Railway projects account for 41% of AIPL's unexecuted order book of Rs 2877.53 crore (as on 10 January 2010). Road projects account for 41% and 3% of the order backlog comprises irrigation projects.

ARSS Infrastructure Projects reported a net profit of Rs 51.04 crore on sales of Rs 624.38 crore in the year ended March 2009.