Jaypee Infratech IPO Review

Jaypee Infratech has come out with a public issue of 6 crore equity shares in the price band of Rs.102 to Rs.117 per share. The company is engaged in the development of the Yamuna Expressway and related real estate projects which is a 6 lane Expressway between Noida and Agra, with concession period of 36 years and also 1235 acres of land as real estate development.

Details of the Issue:
Issue Open: Apr 29, 2010 - May 04, 2010
Issue Size: Equity Shares of Rs. 10.
Issue Price: Rs. 102 - Rs. 117 Per Equity Share.
Market Lot: 50 Shares.
Listing At: BSE, NSE.

To apply or not to apply?

The Yammuna Expressway is expected to be complete by 2011 and has Toll Collection Rights for the next 36 years. Apart from this the company is involved in Building World Class Real Estate Development spread over of 1,235 Acres.

Some of the positives include ,JP Group’s expertise in executing Large Infrastructure projects and Unique Business Model – Tool Revenues and Real Estate Revenues.

But the valuation is the key question.According, to various brokerages, the valuation of Jaypee Infratech is in the range of Rs 100 to Rs 120. Hence at the lower end of the price band, the IPO seems okay. Otherwise one could wait for better opportunities post listing.

4 comments:

  1. The 5% discount factor could be the cushioning factor.

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  2. This is a highly priced issue better to avoid primary market and buy in secondary market after some trading days as it will tell how much liquidity this stock would be able to offer as adequate liquidity is suspected in this case.

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  3. Yes Money Paradise, one can buy post listing. Good for long term.

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