Last updated: 16 Feb, 2021 | 07:43 am
About RailTel Corp
About the issue
Issue open: 16th Feb - 18th Feb 2021
Price band: Rs 93 - Rs 94 per share
Issue Size: Rs 811-819 crore
Issue Size: The issue size includes a reservation of 5 lakh shares for its employees.
Reservation for QIB - 50% , Retail - 35%, Non institutional Investors -15%.
Bid lot: 155 shares, and in multiples of 155 shares
Post issue market cap Rs 2,985- 3,017 crore
At the higher end of the price band, RailTel IPO is priced at a PE ratio of ~21.4 times FY20 earnings per share. This seems to be fairly priced. The company ranks better in terms of margins & return ratios as compared to competitors in the Information and Communication Tech space, as well as the telecom space. Further, it is debt-free and has paid dividends consistently. The management is also confident about steady growth in the coming years.
Given steady margins and return ratios, debt-free status, consistent dividends, reasonable valuations, and limited concerns we remain positive on the prospects of the issue.