Courtesy: https://www.chittorgarh.com/
Review By Dilip Davda on December 11, 2025
- This is the 3rd RI from the company since September 2019.
• The last RI was in the month of February 2023.
• The company is engaged in constructions of infra projects with specialization in hydro and irrigation projects.
• While it posted growth in its top lines for the reported periods, its bottom line declined with pressure on margins.
• Well-informed investors may park funds for long term.
ABOUT COMPANY:
Patel Engineering Ltd. (PEL) is engaged in the construction of dams, bridges, tunnels, roads, piling works, industrial structures and other kinds of heavy civil engineering works and have executed a variety of infrastructure projects in the hydro power, irrigation and water supply, urban infrastructure and transportation segments primarily as civil contractors. It has presence in various technology intensive areas like hydro, irrigation and water supply, urban infrastructure and transport especially in tunnels and underground works for hydroelectric and transportation projects.
Since incorporation, the company has been involved in over 15,000 MW hydropower projects, construction of over 87 dams, 300 kms of tunnelling works, more than 4,000 meter of shaft boring works, over 1,200 kms of roads and irrigated over 0.55 million acres. It has evolved as a construction company specializing in the hydro power generation and irrigation segments.
PEL is an ISO 9001: 2015, ISO 14001:2015 and ISO 45001:2018 certified Company with access to international licensors & contractors which makes it an ideal engineering solutions partner for a wide spectrum of services covering a variety of industries. Its experience, technological abilities and financial strength have given PEL the ability to bid for large infrastructure projects. As of September 30, 2025, it had 4461 employees on its payroll.
ISSUE DETAILS:
The company is coming out with its Rights Issue (RI) of 147765820 equity shares of Re. 1 each at a fixed price of Rs. 27.00 per share to mobilize Rs. 39.90 cr. The RI opens for subscription on December 12, 2025, and will close on December 19, 2025. The company is offering RI in the ratio of 7 for 40 to its eligible stakeholders as of the record date of December 04, 2025. The company is asking for full money on application for the number of shares applied. Post allotment, RI shares will be listed on BSE and NSE. The company is spending Rs. 5.00 cr. for this RI process, and from the net proceeds, it will utilize Rs. 25.40 cr. for repayment/prepayment of certain borrowings including interest thereon, and Rs. 9.50 cr. for general corporate purposes.
The RI is solely self-managed by the company itself., and MUFG Intime India Pvt. Ltd. is the registrar to the issue.
Post-RI, company’s current paid-up equity capital of Rs. 84.44 cr. will stand enhanced to Rs. 99.21 cr. Based on the RI pricing, the company is looking for a market cap of Rs. 2678.78 cr.
FINANCIAL PERFORMANCE:
On the financial performance front, for the last two fiscals, the company has (on a consolidated basis) posted total income / net profit, of Rs. 4544.11 cr. / Rs. 301.60 cr. (FY24), Rs. 5093.36 cr. / Rs. 236.16 cr. (FY25). For H1 of FY26 ended on September 30, 2025, it earned a net profit of Rs. 144.76 cr. on a total income of Rs. 2441.91 cr. Its NAV stood at Rs. 46.58 as of September 30, 2025. Its debt to operating EBITDA at 2.38 as of September 30, 2025, raise concern.
DIVIDEND POLICY:
The offer document is silent on its dividend track records. AS per BSE Website, the company has not paid any dividend since November 2012. It will adopt a prudent dividend policy based on its financial performance and future prospects.
SCRIP PERFORMANCE: BASED ON BSE WEBSITE DATA: SCRIP CODE: 531120 (FV Re. 1).
The scrip last closed on cum-right basis at Rs. 34.94 on December 03, 2025, and opened on an ex-right basis at Rs. 33.68 on December 04, 2025. Since then, it has marked a high/low of Rs. 33.68 / Rs. 29.62. The scrip last closed at Rs. 30.72 as of December 11, 2025. For the last 52 weeks’ it has posted a high/low of Rs. 57.48 / Rs. 29.62.
The promoters’ holding has been constant at 36.11% for the quarter ended with September 30, 2025. The counter is trading above the RI price, with well managed volume by the vested interest quarters.
NOTE: Our family has small long term holding and planning to invest in the RI for eligible number of shares.
Conclusion / Investment Strategy
This is the 3rd RI from the company since September 2019. The last RI was in the month of February 2023. PEL is engaged in constructions of infra projects with specialization in hydro and irrigation projects. While it posted growth in its top lines for the reported periods, its bottom line declined with pressure on margins. Well-informed investors may park funds for long term.
Review By Dilip Davda on December 11, 2025
Review Author
DISCLAIMER: No financial information whatsoever published anywhere here should be construed as an offer to buy or sell securities, or as advice to do so in any way whatsoever. All matter published here is purely for educational and information purposes only and under no circumstances should be used for making investment decisions. My reviews do not cover GMP market and operators game plans. Readers must consult a qualified financial advisor before making any actual investment decisions, based the on information published here. With entry barriers, SEBI wants only well-informed investors to participate in such offers. With crazy listings in the recent past, SME IPOs drew the attention of investors across the board and lead to seer madness. However, as SME issues have entry barriers and continued low preference from the broking community, any reader taking decisions based on any information published here does so entirely at their own risk. The above information is based on information available as of date coupled with market perceptions. The Author has no plans to invest in this offer.
About Dilip Davda
Dilip Davda is veteran journalist associated with stock market since 1978. He is contributing to print and electronic media on stock markets/insurance/finance since 1985.
Dilip Davda is a leading reviewer of public issues and NCDs in the primary stock market in India. The knowledge he gained over 3 decades while working in the stock market and a strong relationship with popular lead managers makes his reviews unique. His detailed fundamental and financial analysis of companies coming up with IPOs helps investors in the primary stock market. Dilip Davda has a special interest in analyzing the SME companies and writing reviews about their public issues. His reviews are regularly published online and in news papers.
(Dilip Davda -SEBI registered Research Analyst-Mumbai,
Registration no. INH000003127 (Perpetual)
Email id: dilip_davda@rediffmail.com ).
Courtesy: https://www.chittorgarh.com/
