“An EPC company that promises roads and bridges… and perhaps a detour for your returns. Ready for the ride?”
🏗️ At a Glance
Globe Civil Projects (est. 2002) delivers EPC solutions across roads, railways, airports, hospitals and schools. FY24 revenues hit ₹332.2 Cr with PAT of ₹15.4 Cr, backed by an ₹892.9 Cr order book. Promoters Khurana family control 88 % pre-IPO. High client concentration and raw-material volatility pose execution and cash-flow risks.
1. 📊 Financial Blueprint: Revenues, Profits & Margins
| Particulars | FY24 | FY23 | FY22 |
|---|---|---|---|
| Revenue (₹ Cr) | 332.2 | 233.3 | 285.7 |
| EBITDA Margin | 11.7 % | 9.8 % | 10.3 % |
| PAT (₹ Cr) | 15.4 | 4.9 | 5.2 |
| ROE | 19.8 % | 7.8 % | 9.1 % |
| Net Debt/EBITDA | 3.1× | 3.6× | 2.4× |
- Revenue Surge: +42 % YoY, driven by execution of large CPWD orders.
- Profit Jump: PAT soared 217 % YoY—courtesy of margin expansion and tighter cost controls.
- ROE Spike: Nearly 20 % return on equity, up from 7.8 % last year.
2. 🏷️ Order Book & Client Concentration
- Total Orders: ₹892.9 Cr as of Aug 31, 2024
- Top 10 Projects: 89.5 % of construction revenues
- CPWD Exposures: 29.8 % of FY24 revenues
- Joint Ventures: 33.4 % of FY24 revenues via JVs
Why It Matters: One delayed mega-contract can freeze cash flows. Heavy CPWD dependence provides payment safety but limits diversification. JV revenues boost scale—until partners delay payments or execute poorly.
3. 👷 Management Team & KMP
| Name | Role | Experience | FY24 Pay (₹ Cr) |
|---|---|---|---|
| Ved P. Khurana | Chairman & WTD (Promoter) | 50+ yrs | 1.00 |
| Nipun Khurana | Managing Director (Promoter) | 20+ yrs | 0.315 |
| Vipul Khurana | Managing Director (Promoter) | 20+ yrs | 0.315 |
| Parveen Sachdeva | COO | 34 yrs | 0.120 |
| Raghav Aggarwal | CFO (Consultant) | 10+ yrs | 0.043 |
| Avinash Pratap | Company Secretary & Compliance | 10+ yrs | – |
| Vijay Kumar | HR Manager | 14 yrs | 0.138 |
- Attrition: ~6.1 %—healthy retention for construction sector.
- Incentives: No ESOPs or bonus plans; management incentives tied to fixed pay.
4. 🧱 Fair-Value Range: Brick-by-Brick Calculation
| Metric | Value |
|---|---|
| EPS (FY24, ₹) | 3.58 |
| Peer P/E Multiple | 18–22× |
| Fair-Value Range | ₹ 64.4–78.8 |
- Lower Bound: 3.58 × 18 = ₹ 64.4
- Upper Bound: 3.58 × 22 = ₹ 78.8
Conclusion: Target FV range ~₹ 64–79. Any IPO pricing above ₹ 79 risks overvaluation—below ₹ 64 offers potential margin of safety.
5. 🔍 IPO Snapshot & Use of Proceeds
- Issue Type: Fresh Issue + Offer for Sale (OFS)
- Expected Price Band: ₹ 65–75 (estimated near FV)
- Fund Utilization:
- Repayment of debt & financing ongoing projects
- Augmenting working capital
- General corporate purposes
Investor Tip: If final band skews above ₹ 79, tread carefully. A discount to FV is prudent for cyclical EPC names.
6. 📈 Growth Catalysts: From Blueprints to Billions
- Geographic Diversification: Expanding beyond North India into Maharashtra, Gujarat & Karnataka—hedges regional slowdown.
- Social Infra Push: Hospitals, schools and sports facilities could fetch higher margins and fees.
- JV Partnerships: Collaborations with reputed players unlock larger bids—yet dilute control and margins.
- Potential M&A: Bolt-on acquisitions can scale capacities; integration risk looms if culture clashes occur.
- Tech Adoption Gap: No explicit plans for drones, BIM or AI-enabled project management—an opportunity for differentiation.
7. ⚠️ Key Risks & Danger Signals
- Client Concentration: CPWD + Top 10 projects = too many eggs in few baskets.
- Commodity Volatility: TMT bars, cement & concrete price spikes can erode margins without fixed-price supply contracts.
- Working Capital Strain: ₹ 92.9 Cr WC requirement + ₹ 41.6 Cr bank guarantees tie up cash and raise financing costs.
- JV Execution Delays: Partner hiccups can stall billing cycles.
- Leverage: Net debt/EBITDA at 3.1×—on the higher side for infrastructure names.
“In globe-building plays, hidden cracks only surface when you step on them.”
8. 😂 Satire Corner: “EPC – Endless Paperwork & Caffeine”
- Lowest-Bid Ballet: Contractors slash prices to win, then scramble to meet specs—change orders follow.
- Escalation Clause Charades: “We’ll pay more if steel surges!” Post-surge, clients dispute every rupee.
- Bonus Bonanza: A 16 : 1 share bonus in July 2024 showered shareholders with paper wealth—yet diluted EPS faster than cement dries. 🎂
- Site Visit Excuses: “Monsoon rains,” “logistics delays,” “supply shortages”—inventive alibis keep you from inspecting progress.
9. 🛠️ Industry Trends & Competitive Landscape
- Sector Growth: India’s infra spend set to cross ₹ 10 Lakh Cr by FY27—big runway for EPC names.
- Peer Metrics: Top-tier EPC names trade at 20–25× P/E; mid-tier like Globe Civil at 18–22× post scale-up.
- Regulatory Tailwinds: PM Gati Shakti and National Infrastructure Pipeline bolster project pipelines.
- Challenges: Permitting delays, land acquisitions and labour shortages can stall timelines.
10. 🎯 Final Verdict: Hard Hat or Hard Pass?
| Stance | Rationale |
|---|---|
| Bullish ✅ | Strong FY24 growth & ROE spike Healthy order book & geographic diversification Social infra margins potential |
| Bearish ❌ | Client & project concentration risk High working-capital intensity Commodity price exposure |
Bottom Line: Globe Civil Projects IPO could reward risk-tolerant investors seeking mid-tier EPC exposure—especially if priced closer to ₹ 64 than ₹ 79. Conservative investors craving stable cash flows should wait for more client diversification and tech-driven execution assurances.
📜 Tags
GlobeCivil IPO EPC Infrastructure FairValue Satire EduInvesting
✍️ Written by Prashant | 📅 June 23, 2025
