EMS Limited, which used to be called EMS Infracon, is getting ready for an IPO (Initial Public Offering). This means they are going to start selling shares of their company to the public, and you can buy them starting from September 8, 2023. EMS Limited is an important company in the business of managing water and wastewater. Their IPO has caught the eye of many investors who are interested in this field. In this article, we will give you all the details about the EMS IPO, including important dates, the good and not-so-good things about it, and whether you should consider buying their shares or not.
EMS IPO Details
|IPO Open||September 8, 2023|
|IPO Close||September 12, 2023|
|IPO Price||₹200 – ₹211|
|IPO Size||₹321.24 Cr|
|Listing At||BSE, NSE|
IPO Objects of EMS IPO
The objects of the IPO issue contains both Offer for Sale (OFS) and fresh issue.
- Under OFS, the amount goes to selling share holders.
- Fresh issue would be used for the following objectives:
- Funding of working capital requirements of the company; and
- General corporate purposes.
EMS IPO Timetable (Tentative)
EMS IPO opens on September 8, 2023, and closes on September 12, 2023.
|IPO Open Date||Friday, September 8, 2023|
|IPO Close Date||Tuesday, September 12, 2023|
|Basis of Allotment||Friday, September 15, 2023|
|Initiation of Refunds||Monday, September 18, 2023|
|Credit of Shares to Demat||Wednesday, September 20, 2023|
|Listing Date||Thursday, September 21, 2023|
|Cut-off time for UPI mandate confirmation||5 PM on September 12, 2023|
To evaluate the value of the EMS IPO, let’s look at some important financial numbers.
- IPO Price Range: EMS is offering its shares at a price between Rs 200 and Rs 211 per share.
- Price-to-Earnings (P/E) Ratio – FY23: Based on the earnings per share (EPS) of Rs 23.15 for the previous fiscal year (FY23), the P/E ratio is approximately 9x. This ratio helps us understand how much investors are willing to pay for each rupee of the company’s earnings.
- Price-to-Earnings (P/E) Ratio – Last 3 Years: If we take the weighted EPS for the last three years, which is Rs 42.54, the P/E ratio comes out to be approximately 5x. This metric provides a broader view of the company’s earnings over a longer period.
- Comparison with Peers: When comparing EMS to its industry peers, a listed company like VA Tech Wabag has a P/E ratio of 14x. While it’s not ideal to base a valuation solely on one company, it’s worth noting that EMS Limited’s IPO price range, with a P/E ratio ranging from 9x to 5x, appears to be attractively priced in comparison.
In summary, considering the P/E ratios, EMS Limited’s IPO seems to be reasonably priced. However, it’s crucial to look at other factors, such as the company’s financial health, growth prospects, and market conditions, before making an investment decision.
|Financial Year ending / Period ending (Amt in Crores)|
|Profit After Tax||72.43||71.91||78.93||108.85|
|Reserves and Surplus||218.24||290.16||368.43||443.45|
Reasons to Consider Investing in the EMS IPO:
- Diverse Portfolio: EMS Limited offers a wide range of services related to water and wastewater management, including solutions for sewage, water supply, treatment plants, and electrical distribution. This diversity makes them well-suited to serve various government authorities and organizations.
- Proven Track Record: EMS Limited has a history of successfully managing and maintaining multiple projects in five different states. This track record demonstrates their experience and expertise in the field.
- Experienced Team: The company boasts its own team of civil construction experts and employs over 57 engineers. They also collaborate with third-party consultants and industry professionals. This experienced workforce is likely to contribute to the efficient execution of projects.
- Reasonable P/E Ratio: The Price-to-Earnings (P/E) ratio for EMS Limited’s IPO is 9x, which suggests that the IPO is priced reasonably compared to its market capitalization. This valuation may be appealing to potential investors.