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Considering the upper price band of ₹294, it signals towards listing at a significant premium compared to its IPO price.
Akriti Mehrotra of StoxBox expects Denta Water shares to make a strong market debut, anticipated it to list with a premium of 35%.
The analyst believes the company will benefit from the growing trend, where the industry is projected to reach $23.9 billion by 2033 due to its strong track record.
Currently, the company has an outstanding order book of Rs. 752 crore, majorly from the Karnataka government. Additionally, the company focuses on expanding its footprint to potential regions like Gujarat, Madhya Pradesh, Maharashtra, and Uttar Pradesh.
Further, the company’s asset-light model enhances project execution through joint ventures and development management. This approach reduces the capital expenditure and improves return ratios, resulting in the debt-equity ratio of the company for the first half of financial year 2025 being 0.
Overall, Denta Water’s strategic focus on water management projects, expanding market opportunities, and robust order book position it for continued growth in the water management and infrastructure sectors.
The analyst advised investors who have been allocated shares to hold their positions with a medium- to long-term outlook.
According to Shivani Nyati of Swastika Investmart, the Denta Water and Infra Solutions Limited IPO is generating significant investor interest, with a strong subscription of 221 times and a good GMP of 30%.
Given the financial performance and the potential risks, this IPO may consider for listing gains as well as the long-term investment horizon, Nyati said.
The company sold its shares in the range of ₹279-294 apiece.
Denta Water will use the fresh issue proceeds for its working capital requirements, which amounts to ₹150 crore. Of which, ₹50 crore will be utilised in the current financial year and the remaining ₹100 crore in the next financial year i.e. ₹100 crore.
Incorporated in 2016, Denta Water and Infra Solutions is a growing water and infrastructure solutions company engaged in designing, installing, and commissioning water management infrastructure projects with expertise in groundwater recharge projects.
The company has successfully executed major projects like Byrapura, Hiremagaluru LIS, and KC Valley, contributing to Bengaluru’s wastewater management and supporting the Government’s Jal Jeevan Mission.
As of November 30, 2024, the company has 17 ongoing projects to be implemented by them or under consortium. The company’s share in the aggregate contract value comprises of Rs 1,100.4 crore, out of which Rs 1,066.7 crore is about water management projects.
Smc Capitals Limited is the book running lead manager of the Denta Water IPO, while Integrated Registry Management Services Private Limited is the registrar.
