Latest Developments in the IPO Market: Globe Civil Projects and VMS TMT
In a significant move within the Indian capital markets, two companies, Globe Civil Projects and VMS TMT, have submitted draft papers to the Securities and Exchange Board of India (SEBI) with plans to raise capital through initial public offerings (IPOs). This is indicative of the continual growth and interest in the IPO landscape, showcasing the potential for expansion in various sectors.
About Globe Civil Projects
Based in New Delhi, Globe Civil Projects operates as an Engineering, Procurement, and Construction (EPC) company specializing in infrastructure projects. The company has established a solid reputation by successfully completing a wide array of infrastructure initiatives. Currently, Globe Civil Projects aims to issue approximately 1.9 crore new equity shares through its IPO, without any existing shareholders selling their stakes, thereby enabling the company to retain all proceeds from the offering.
Use of Proceeds from Globe Civil Projects IPO
| Purpose | Amount (in Crores) |
|---|---|
| Working Capital Needs | 75 |
| Purchase of Equipment or Machinery | 14.06 |
| General Corporate Purposes | Remaining Funds |
Promoter Shareholding and Company Performance
The promoters of Globe Civil Projects own an impressive 88.14% stake in the company, with the remaining 11.86% held by public shareholders, including the Chanakya Opportunity Fund I. The EPC firm not only handles infrastructure but also offers services in mechanical, electrical, and plumbing (MEP), architecture, HVAC, fire protection, and alarm systems. Over the past two decades, Globe Civil Projects has completed 37 diverse projects and currently has 12 ongoing initiatives, which include five in the Social and Commercial Infrastructure segment and three in Transport and Logistics. As of August 2024, the company’s order book stood at a healthy ₹892.95 crore, highlighting its robust project pipeline.
VMS TMT: Pioneering Eco-Friendly Solutions
Headquartered in Gujarat, VMS TMT is a manufacturer of Thermo Mechanically Treated (TMT) bars, crucial for the construction industry. The company is preparing to raise funds by issuing 1.5 crore equity shares. The IPO proceeds are earmarked for several key initiatives, demonstrating a strategic approach to growth and sustainability.
Allocation of Funds from VMS TMT IPO
| Purpose | Amount (in Crores) |
|---|---|
| Setting up Solar Energy Plants | 46.4 |
| Long-term Working Capital Requirements | 30 |
| Repayment of Loans | 11 |
| General Corporate Purposes | Remaining Funds |
Promotional Stake and Financial Health
The promoter group holds a substantial 96.28% stake in VMS TMT, while public shareholders, including the Chanakya Opportunity Fund I, account for the remaining 3.72%. With outstanding borrowings amounting to ₹252.5 crore as of August 2024, the company’s IPO will serve as a critical financial step toward its expansion and operational goals, enhancing its market positioning in the TMT industry.
These IPOs not only represent an opportunity for investors to engage with promising firms but also signify the growing trend of companies seeking public investment to fund their operations and expansion plans. As the IPO market continues to evolve, both Globe Civil Projects and VMS TMT exemplify the dynamic nature of this sector and the potential for innovation in infrastructure and manufacturing.
