MBL Infra IPO Grading

The grading takes into account the company’s good track record in the road maintenance business segment, which would benefit from the current boom in the road construction industry. The IPO Grade assigned by ICRA takes into account MBL’s experienced management team, its demonstrated track-record of having successfully executed small to medium size projects in the roads segment, and its healthy order book position, which along with the buoyant outlook for the construction industry, is expected to provide for growth in the company’s revenues and profits. The company was incorporated as a public limited company in 1995 as Maheshwari Brothers. An ICRA statement stated that going forward, ICRA expects the MBL’s funding requirements to increase in line with its need to augment its equipment and working capital, which is required to support its increased scale of operations; and the funds from the proposed IPO would enable MBL to maintain a prudential capital structure while funding its growth. In addition to funding, the company’s ability to retain and attract experienced personnel will also be crucial for its future growth. The order book of the company has witnessed healthy growth over the past two years buoyed by the overall growth in the infrastructure sector. The company’s current order book stands at Rs. 7.62 billion which is around 2.14 times the turnover of the company from its construction business in FY 2009. Given the opportunities in the road segment and the buoyancy in the construction industry, ICRA expects MBL’s order book to remain healthy in the medium term, which is expected to provide for growth in the company’s revenues and profits.