Nu Tek India – IPO Analysis
We can certainly consider an investment in the IPO of Nu Tek India, with the given the reasonable asking price and the potential for this business. The company enables telecom companies to expand their tower infrastructure, by providing end-to-end services. Nu Tek delivers telecom infrastructure roll out services, including civil and electrical works, for wireless communication providers.
Nu Tek plans to raise Rs.86.4 crore, including an offer for sale of one million shares by an existing shareholder at a price band of Rs.170-Rs.192.
The company is looking to deploy the proceeds towards capital expenditure, overseas acquisitions and augmenting working capital.
The offer is open from July 29 to August 1. IIFL and SPA Merchant Bankers are the book-running lead managers to the issue.
At Rs 192 (upper end of the price band), the offer values the business at 15 times its 2007-08 earnings on a fully diluted post-offer equity base. The company’s revenues have, over the past three years, grown at a compounded annual rate of 46 per cent to Rs 96.7 crore, while the net profits have increased at a rate of 57 per cent to Rs 21.2 crore. The valuation is, therefore, not too demanding.
Courtesy: An Analyst reader of this blog
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