Rs 6,546 crore order book: Adani Infra to acquire 30 per cent stake in this civil construction company; Existing promoters and Adani to have joint control

The stock is up by 14.5 per cent from its 52-week low of Rs 566.50 per share.

Adani Infra (India) Limited, Adani Group’s PMC arm, has today signed definitive agreements to acquire up to 30.07 per cent stake from PSP Project Limited’s existing promoter - Mr. Prahladbhai S. Patel. Presently, Mr Prahladbhai S Patel and Family own 60.14 per cent stake in the Company. PSP Projects Limited, listed on NSE and BSE, is one of the leading EPC companies in India with an order book of Rs 6,546 Crore, and having executed marquee projects such as Surat Diamond Bourse, Kashi Vishwanath Dham, Palladium Mall (Ahmedabad), among others.

Adani Infra (India) Limited is the PMC arm of Adani Portfolio, which is owned 100 per cent by the Adani Family. Adani Portfolio of Companies is engaged in infrastructure development in ports, roads, airports, water, datacentres, power projects, renewable energy, green hydrogen, cement, transmission and distribution. The partnership will aim to propel PSP Projects into becoming one of the leading EPC companies in India, on the back of accelerated growth in India’s infrastructure development. Adani Portfolio of Companies is looking to invest USD 100 billion as capex over the course of next decade.

PSP Projects will continue to be led by existing Chairman, MD & CEO - Mr. Prahladbhai Patel, the visionary founder promoter of PSP. As part of the transaction, Adani Infra will get equal rights and representation on the board. The transaction remains subject to customary approvals and regulatory approvals including completion of the open offer in compliance with SEBI Takeover Regulations.

About the Company

A multidisciplinary construction company offering a diversified range of construction and allied services across industrial, institutional, government, government residential and residential projects in India. It provides its services across the construction value chain, ranging from planning and design to construction and post-construction activities, including MEP work and other interior fit outs to private and public sector enterprises. The company had a market cap of Rs 2,464 crore and as of September 30, 2024, the company’s order book stands at Rs 6,546 crore.

The company's shares are trading at a PE of 27x whereas the sectoral PE is 30x and an ROCE of 15 per cent. As of September 2023, Madhulika Agrawal wife of an ace investor of Mukul Agrawal owns a 2.52 per cent stake in the company. The stock is up by 14.5 per cent from its 52-week low of Rs 566.50 per share. Investors should keep an eye on this small-cap stock.

Disclaimer: The article is for informational purposes only and not investment advice.