PKH Ventures files IPO papers with SEBI

Despite the uncertainty in the markets over the status of the LIC IPO and the consistent FPI selling, the filings are continuing unabated. In the latest development, PKH Ventures has filed draft red herring prospectus (DRHP) with SEBI to seek approval for its proposed IPO.

PKH Ventures is a construction and hospitality company which wants to make the best of the current construction boom and the rising demand for construction in India.

The PKH Ventures IPO will be a combination of a fresh issue and an offer for sale (OFS). The overall public issue of PKH Ventures will comprise of a fresh issuance of 182.60 lakh equity shares and an Offer For Sale (OFS) of 98.30 lakh equity shares by the promoters and the early investors in the company.

However, the actual value of the IPO will only be known once the price band for the issue is fixed by the company and its merchant bankers.

SEBI normally takes about 2-3 months to approve the IPOs. The approval is given in the form of observations issued by SEBI, which is tantamount to approval. Post the approval, the company can go ahead with planning the public issue dates, price band, marketing plan etc.

The IPO would possibly target June or July this year, depending on when the SEBI approval comes through. Real estate IPOs have been and far between in recent times.

The proceeds of the fresh issue component will be used by the company largely to invest in its two subsidiaries viz Halaipani Hydro Project Pvt Ltd and Garuda Constructions.

The funds would be essentially used for bankrolling the long-term working capital requirements of the company, strategic acquisitions and general expenses. PKH Ventures may also explore a pre-IPO placement of 15 lakh shares, in which case the IPO size would be reduced accordingly.

PKH Ventures is based out of Mumbai and has 3 broad business verticals viz. construction, management and hospitality. For FY21, PKH Ventures had reported net profits of Rs.51.63 crore on total revenues of Rs.265 crore, implying net profit margins of 19.48%.

The issue of PKH Ventures will be managed by IDBI Capital Markets and BOB Capital Markets, and they will act as the book running lead managers for the IPO of PKH Ventures.

The company has some marquee executions in the civil construction space. For instance PKH Ventures has constructed more than 1.5 million SFT in various private and government projects with the construction and development business being the main growth engine.

In addition, PKH also manages restaurants, bars, food stalls, lounges, parking spaces, ticket counters etc at airports. Over last 18 years it has managed more than 15 airports in India.

PKH Ventures executes civil construction contracts for the government and for private parties. It has been awarded two government projects with a combined project value of Rs.214 crore. This includes a hydro power project and a project in Nagpur. As of September 2021, the PKH Ventures had an order book position worth Rs.1,174 crore.

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