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PKH Ventures Submits Draft Papers For IPO With SEBI

13 September 20225 mins read by Angel One
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PKH Ventures Ltd has filed preliminary documents for an IPO in which founder Pravin Kumar Agarwal, who controls 63.69 percent of the Mumbai-based company, plans to sell up to 9.83 million and issue up to 18.26 million shares. The issue’s primary managers are BoB Capital Markets and IDBI Capital.

The money will go to the firm’s subsidiary, Halaipani Hydro Project Pvt Ltd. The total investment is anticipated to be Rs 1,241 crore. The revenues will also be used to cover long-term working capital needs for Garuda Construction, the company’s construction subsidiary. The financing is expected to cost Rs 800 crore. Proceeds will also be used to fund inorganic expansion via acquisitions and other means. This is expected to cost Rs 400 crore.

Bars, restaurants, lounges, food stalls, ticket desks, parking spots, and other amenities are managed by the firm at airports. It has administered more than 15 airports in India during the last 18 years. The building and development vertical is the company’s key growth engine, having built over 1.5 million square feet in different private and government projects. The firm has an order book of Rs 1,174 crore as of September 24, 2021.

It specializes in civil construction and has been granted two government contracts: one for a hydropower project and the other for a Nagpur project. The developments are expected to cost Rs 214 crore. Civil construction is carried out by Garuda, which has an order book of Rs 559.75 crore as of March 10, 2022. PKH Ventures’ revenue for the fiscal year 2021 was Rs 241 crore, up from Rs 166 crore the previous year. The net profit for the period was Rs 51.6 crore, up from Rs 14 crore the previous year.

Green bonds and digital currencies have a lot of potential

The next fiscal year will be fascinating because it may see numerous budget suggestions come to fruition. The most prominent example is the LIC disinvestment, which was meant to be finished in March but now appears like it would be done in the next fiscal year. However, when will this be completed?

The outcome of the conflict is unknown, and if the IPO has been delayed because of this uncertainty, there is no assurance that the situation will improve in April or May. Markets look to have returned to normality as 2021-22 comes to a conclusion. In hindsight, the government might have made the initial public offering.

The issue of sovereign green bonds and the creation of a central bank digital currency are the other two significant budget announcements. The government and the RBI will collaborate on these two launches. While global uncertainty may make it an unfavorable time for testing, the administration seems committed to both measures, and they will most likely be implemented.

The concept of a sovereign green bond is innovative. It will be financed by the government’s borrowing plan. The government’s total borrowing programme is about Rs 14.95 lakh crore. The government has to raise this money to fund the deficit, which includes both revenue and capital expenditures. However, since money is fungible, it is difficult to determine where the borrowed funds are spent. However, an exception must be made in the case of sovereign green bonds. The SGB generated will be part of the overall borrowing programme and must be utilized for ESG-compliant projects. As a result, the bond must be ESG compliant whether it is used to fund a power project or a road, or if it is used to fund revenue spending. It’s a good idea to lay the basis for this ahead of time.

These bonds will be difficult to price. Due to the fact that these bonds are not G-secs, they may have to give a higher return, since all ESG-compliant corporations must make particular investments, which will raise expenses. Or will these bonds be offered at a reduced rate to facilitate ESG implementation? Furthermore, given today’s low-interest rates — actual returns on deposits are negative — SGBs may be issued as tax-free bonds that are available to the general public. Given that they are government-issued bonds, there will be a lot of interest. The government and the central bank have been attempting to persuade ordinary investors to engage in the government’s borrowing programme, and this step will hasten the process.

Disclaimer: This blog is exclusively for educational purposes and does not provide any advice/tips on investment or recommend buying and selling any stock.

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