Globe Civil Projects IPO: Check IPO Date, Lot Size, Price & Details

Introduction:

The company is an integrated engineering, procurement, and construction (“EPC”) company headquartered in New Delhi. The company has undertaken projects in eleven (11) states of India, namely, Uttar Pradesh, Haryana, Delhi, Maharashtra, Andra Pradesh, Karnataka, Gujarat, Chhattisgarh, Rajasthan, Uttarakhand, and Himachal Pradesh.

The company is into execution and construction of infrastructure projects comprising of Transport and Logistics projects, Social and Commercial projects and Non-Infrastructure projects comprising of commercial offices and housing. Although company’s primary focus and strength had been deeply rooted in construction of education institution buildings and railway infrastructure, it has diversified in undertaking specialized infrastructure and non-infrastructure projects, such as railway bridges, airport terminal, elevated railway terminal and railway bridges and hospitals. Additionally, it has undertaken trading of goods, particularly TMT steel.

As of the date of this Red Herring Prospectus, it has successfully completed thirty-seven (37) projects in the last two decades. Currently, it has thirteen (13) on-going projects, including five (5) Social and Commercial Infrastructure projects, three (3) Transport & Logistics projects, four (4) Residential Building projects and one (1) Office Building project. It works with a number of reputed clients and are associated with some of the marquee construction projects in India. As of March 31, 2025, its Order Book is ₹6,691.02 million

IPO Details:

Objectives of Issue:

• Funding the working capital requirements of the Company
• Capital expenditure towards purchase of construction equipments/ machineries.
• General corporate purposes .

Key Strengths:

• Reducing Dependency on CPWD - During the nine-month period ended December 31, 2024, and for Fiscal Years 2024, 2023, and 2022, the Company derived 10.10%, 29.77%, 57.48%, and 54.62% of its revenue from operations, respectively, from the construction project receipts segment, primarily attributable to projects awarded by the Central Public Works Department (CPWD), its largest customer. This declining trend underscores the Company’s strategic initiatives to mitigate customer concentration risk and diversify its revenue base beyond CPWD-led projects.
• Expansion in different geographical footprint- Headquartered in New Delhi, the Company has steadily expanded its presence across eleven states in India, including Uttar Pradesh, Haryana, Delhi, Maharashtra, Andhra Pradesh, Karnataka, Gujarat, Chhattisgarh, Rajasthan, Uttarakhand, and Himachal Pradesh. Recognizing the strategic importance of geographical diversification, the Company aims to leverage opportunities within its existing markets while actively pursuing expansion into new regions. By undertaking projects beyond Delhi, it is broadening its operational footprint and aligning its growth strategy with the evolving development trends across various parts of the country.

Risks:

• Dependency on Joint Venture - For the nine months period ended December 31, 2024 and for the Fiscal 2024, Fiscal 2023 and Fiscal 2022, company’s revenue from operations from projects undertaken under JVs contributed 36.40%, 33.36%, 28.98%, and 35.15%, respectively, amounting to ₹897.92 million, ₹978.44 million, ₹575.36 million, and ₹891.50 million, respectively. The failure of a JV counterparty or consortium member to perform its obligations could impose additional financial and performance obligations resulting in reduced profits or, in some cases, significant losses, and it may adversely affect its business, results of operations and financial condition. Further, as on the date of this Red Herring Prospectus, it has 6 Joint Ventures. Out of the 13 ongoing projects as on March 31, 2025, 4 projects are being undertaken with Joint Ventures.
• Concentrated Project – The Company’s revenue remains highly concentrated, with its top ten projects contributing, on average, over 90% of total revenue during the nine-month period ended December 31, 2024, as well as in each of Fiscal 2024, Fiscal 2023, and Fiscal 2022. While several new projects are currently under execution, the substantial scale of its projects suggests that a significant portion of revenue will continue to be derived from its top ten projects. Consequently, any delay, suspension, or termination of one or more of these key projects could materially and adversely impact the Company’s business operations, financial performance, and overall condition.
• Losses and Contractual Penalty due to delay in completion of projects- The Company may incur losses on its projects or contracts, or face disputes and contractual penalties, due to delays in execution or failure to meet specified contract requirements or project timelines. In the past, certain projects have experienced delays, necessitating the renegotiation of terms—for instance, the construction of Faculty Housing and Hostel at IIM Udaipur, where delays arose from a combination of internal and external factors beyond the Company’s control. As a result, in Fiscal 2022, the Company was required to pay a penalty of ₹0.73 million to the Central Public Works Department under the terms of the contract. Such delays and associated penalties can negatively impact the Company’s reputation and may have a material adverse effect on its business, operational results, and financial condition. Additionally, the imposition of damages or the need to renegotiate project terms may further strain its financial and operational performance.
• Future Revenue Visibility- As a part of its business and operations, it bids for projects on a continual basis. Projects are awarded following competitive bidding processes and satisfaction of prescribed qualification criteria. For the nine months ended December 31, 2024, the Company submitted successful bids for 11 projects but secured only one, reflecting a success rate of 9.09%, compared to 54.55% in FY24. Its revenues depend upon the award of new contracts and the timing of those awards. This success rate is reflected in the company order book as well as it is declining on year to year basis casting doubt over company future earning capability

Financial Snapshot:

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