Cox and Kings IPO Review

Cox and Kings (India) one of the leading holiday brands that is known for its - One Stop Shop for all travel services, is coming out with an IPO of 18,496,640 equity shares of Rs 10 each for cash at a price band of Rs 316-330/share.

Details of the issue:
Issue date: Open from November 18, 2009 to November 20, 2009.
Issue size : Rs 610 crores.
CARE has assigned a IPO GRADE 4 and it indicates above average fundamentals.
Listing at BSE and NSE.

The objective of the issue is for repayment of loans,acquisitions and upgrading existing operations. Its business can be broadly categorized into Corporate Travel, Leisure Travel,Forex and Visa Processing. It provides end to end travel solutions including land, air and cruise bookings,local sightseeing,hotel bookings,visa, passport and medical insurance assistance.

The standalone EPS for the year 2009 is Rs.14 and at lower end of the price band, it would trade at an P/E of 22 and at higher end, it is 26. The issue looks reasonable but the only concern being, recent IPOs have not gone well with the market due to overpricing of many issues. Long term investors can consider investing in this issue.