Technofab Engineering IPO opens on June 29

Technofab Engineering Ltd. (TEL) has decided to open its Initial Public Offering (IPO) for subscription on June 29, and to close on July 2. Technofab Engineering has filed the Red Hearing Prospectus with the Registrar of Companies, NCT of Delhi and Haryana (RoC) to enter the capital markets with an IPO of 29,90,000 equity shares of face value of Rs.10 each for cash at a price to be decided through a 100% book-building process. The Issue comprises of a reservation of 50,000 Equity shares of Rs.10 each for eligible employees. The issue will constitute 28.50% of the post issue paid-up equity capital of the company. The net issue will constitute 28.03% of the post issue paid-up equity capital of the company.

The company is proposing the IPO to meet long term working capital requirements of Rs300mn, finance procurement of construction equipment for Rs162.38mn, finance setting up of maintenance and storage facility for construction equipment for Rs49.95mn, setting up training centre for employees for Rs54.07mn and balance for general corporate purposes. Fitch Ratings India has assigned a grade of ‘3 (ind)’ out of a maximum of ‘5 (ind)’ to the proposed IPO of TEL. The grade indicates the average fundamentals of the issue relative to other listed equity securities in India. TEL is engaged in the business of providing Engineering Procurement and Construction (EPC) services, and executing a wide range of Balance-of-Plant (BoP) and electro-mechanical projects on a complete turnkey basis.