Karda Constructions IPO Opens on March 16, 2018
Nashik-headquartered real estate developer Karda Constructions Limited is all set to launch its maiden IPO. The IPO shall offer 43,00,000 equity shares at a price band of Rs. 175/- to 180/- making the issue size of around Rs. 77.40 crores (at the upper price band). The shares of the company will list on BSE and NSE. The sole lead manager to this issue is Aryaman Financial Services Limited and Registrars to the issue are Bigshare Services Private Limited.
The main objectives of the company to come up with an IPO are to reduce its debt. Talking on the context of utilizing funds raised through the IPO, Mr. Naresh Karda, Chairman and Managing Director of Karda Constructions Limited, said, “Our company has availed certain credit facilities from different banks as well as term loans from financial institutions. As part of our long term equity value creation plan we intend to repay certain portions of our debt.” He also said that “Repayment of this debt would help us in maintaining a favourable debt-equity ratio and enhance our leveraging capacity.”
The Company is focused on quality and affordable developments. With an established brand, reputation and track record of developing innovative projects through emphasis on contemporary architecture, strong project execution and quality construction in the real estate industry, Company had earlier received “Mega Builder of the Year” award of Divya Marathi.
The company has successfully delivered over 17 projects totalling 1107 units with total delivered carpet area standing at 10,50,525 sq. ft. The company is currently developing over 17 lakh sq. ft. through its 11 on-going and 3 planned projects which are planned to be delivered over the next few years. Also the company boasts of strong available land reserves of over 4 lakh sq. ft. duly registered titles in the name of the company which provides ample visibility of developable sq. ft. in the future.
EPS of Karda Constructions Limited during the year 2015 was recorded at Rs. 3.08 but in the very next year, it rose to Rs. 6.37 and in the year 2017, EPS was recorded at an impressive Rs. 8.03. The EPS for the six months ended September 30, 2017 is Rs. 5.52 (not annualised). The company’s management is optimistic of an improvement in financial results riding on the wave of the ongoing projects and arrival of fresh projects in the current year.
The company which has already made significant foot print in the real estate segment, is now aggressively looking at key opportunities in the construction contracts business. It is already awarded four prestigious government projects in Goa and Nashik as well as two private sector construction contracts making the order book of this new vertical at around Rs. 60 crores. It has obtained Class I-A PWD license and is aiming at expanding its contractual construction business considering diversification benefits and economies of scale w.r.t purchase of materials etc.
About Karda Constructions Limited
The Karda Group is a well-established Nashik based group having its presence in the construction industry for more than two decades. The group was founded by promoter Mr. Naresh Karda in year 1994. In the years following its inception the group concentrated on developing affordable housing in the residential segment and from year 2001 onwards, the group diversified into commercial segment. Karda Constructions Limited was incorporated in 2007 with a view to corporatize the group’s activities in the real estate sector.