Contrary to analysts’ expectations, the FY24 debut turned out to be a flop as Udayshivakumar Infra debuted on April 3 at a discount of 14% to the issue price of Rs 35.

The stock opened at Rs 30 on the NSE and Rs 31 on the BSE on Monday.

The company was established in 2002 and is engaged in road construction in Karnataka. Its IPO, an entirely new issue of Rs 66 crore, was 30.63 times oversubscribed. High-net-worth individuals subscribed 60.42 times the quota, qualified institutional buyers subscribed 40.47 times, and the retail sector subscribed 14.10 times.

On December 31, 2022, the company had 46 work orders with a total book value of Rs 1,290.39 crore.

But its revenue growth has been inconsistent. In FY20, it was Rs 193 crore. It grew to Rs 210 crore in FY21 and fell to Rs 185 crore in FY22.

Reliance Securities said in its IPO note that the company’s returns have been declining, with RoE (return on equity) and RoCE (return on capital employed) falling by 460 and 237 basis points, respectively, to 17.8% and 15.4% in FY20-22.

However, it likes the company due to its low debt-to-equity ratio and FY23 annualized financials at a valuation of 9.7x P/E.