Maytas Infrastructure

Maytas Infrastructure – one more infra company
Nothing that makes us subscribe

IPO Opens: September 24, 2007
IPO Close: October 4, 2007
Price Band: Rs 320-370
Lead Manager: DSPML, JM Financial & Kotak

Business
A construction company deriving revenues from segments such as irrigation, roads, bridges and buildings infrastructure. The orders in hand, at Rs 3,589 crore as of June 2007, amount to 4.5 times the total revenues for FY-07.

Over a period of time, the company has moved from low margin contract player to a high margin turnkey business. Over a period of time the company is diversifying into various segments, reducing the dependence on construction segments

The SPV model is expected to reduce the execution risks and subsequently offer an entry into high margin turnkey project along with larger and more experienced players.

Growth
FY 2001-02 to FY 2004-05: Revenue-- 15.38% CAGR
FY2005-2006- to FY2006-2007: Revenue -- 65.18% CAGR

Objectives
Funding three infrastructure projects including two power projects

Risks:
Long gestation period.
Project execution and cost reduction risks

Valuation:
P/E multiple of 34 to 40 times.

Objectives:
If you invest, invest with a long term in mind of at least two three years period.
If you don’t invest you are not losing anything great.