I was reading among all the many posts which are posted in this forum.
I saw that so many people are intentionaly misleading people to "not subscribe" this issue, so that they can subscribe it themselves by reducing the oversubsciption. I would sincerely suggest reading the following information. It is written in simple language and thus not difficult to understand even by new comers.
Mundra Port and Special Economic Zone is entering the capital market on 1st November, 07 with a public issue of 402.50 lakh equity shares of Rs.10 each, in the band of Rs.400 to Rs.440 per share.
The company is the developer and operator of Mundra Port, which has a deep water draft ranging from approx. 15 meters to 32 meters in depth, at a distance of about 15 km. from shore, where it is used to unload crude, a big business potential. The port is principally engaged in providing port services for bulk cargo, container cargo, crude oil cargo, and value added port services including railway services. The commercial operations of the port has commenced from October 2001. Total cargo volume at Mundra Port increased from 11.7 million MT in FY 06 to 19.8 million MT in FY 07.
The concession agreement for the port is 30 years, which would expire on 17-02-2031, and 3,404 acres of land has been permitted to get used for the port alongwith a right to use the foreshore land and waterfront, and on 17-02-2031 the port shall be transferred to Gujarat Maritime Board.
The company presently has 15,665 acres of land available and 16,688 acres of additional land are at various stage of being transferred to the company, thus aggregating 32,353 acres for Port and SEZ.
If we calculate the enterprise value, post IPO, at the upper band of Rs.440 per share, the same works out at Rs.17,600 crores and adding debt of Rs.1,400 crores it works out to Rs.19,000 crores, which is very low compared to the size and operations of the Port and SEZ.
The company now has estimated a requirement of Rs.3,160 crores, which is mainly being Rs.700 crores for SEZ, Rs.2,000 crores for coal terminal project, Rs.255 crores in Adani Petronet (Dahej) Port, Rs.49 crores for Adani Logistic and Rs.156 crores for Inland Conware P. Ltd. This is being financed by debt of Rs.1,200 crores, internal accruals of Rs.525 crores and Rs.1,435 crores from proposed IPO. At the upper band, issue would mobilize Rs.1,770 crores which would take care of this requirement.
The noteworthy feature of the project is that such a big port is already operational, with virtually, entire land for port and SEZ having acquired. The potential of revenue generation is huge in view of all weather nature as also huge cargo inflow of coal mainly for Tata Power (4,000 MW) Ultra Mega Power Project and Adani Power, 2,640 MW, project. The crude cargo would also give huge revenue to the port. SEZ income would be added to the revenue and profitability of the company, in the coming years. However, concession period of 30 years, expiring in 2031 is considered to be of shorter duration.
As the infrastructure projects have huge potential and this being an operational Port, it represents an excellent investment bet and is recommended for investment even at the upper band of Rs.440 per share.
It is further recommeded to apply for 225 shares - 99000 rs.
Chances of allotment are good only in 12+ lots. Therefore 15 lot has the best chance for allotment.
Make a sound decision yourself and invest wisely.
Zerodha (Trading & Demat Account)
RHP
