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Denta Water and Infra Solutions Ltd. is set to debut on the stock exchanges on Wednesday, January 29
Denta Water IPO
Denta Water and Infra Solutions Ltd. is set to debut on the stock exchanges on Wednesday, January 29. Ahead of the listing, the company’s shares are commanding a grey market premium of Rs 76.
With an upper price band of Rs 294, this suggests the shares may list at a notable premium compared to the initial public offering (IPO) price.
Akriti Mehrotra of StoxBox forecasts a strong market debut for Denta Water, expecting a listing premium of 35%. The analyst believes the company is well-positioned to benefit from the industry’s projected growth, with the sector estimated to reach $23.9 billion by 2033, thanks to Denta Water’s solid track record.
What Does The Company Do?
Founded in 2016, Denta Water and Infra Solutions is a growing company specializing in water management infrastructure projects, with expertise in groundwater recharge. The company has completed significant projects such as Byrapura, Hiremagaluru LIS, and KC Valley, contributing to Bengaluru’s wastewater management and supporting the Jal Jeevan Mission.
As of November 30, 2024, the company has 17 ongoing projects, with an aggregate contract value of Rs 1,100.4 crore, of which Rs 1,066.7 crore pertains to water management initiatives.
SMC Capitals Limited is the book-running lead manager for the Denta Water IPO, and Integrated Registry Management Services Private Limited is the registrar.
The company currently holds an order book worth Rs 752 crore, primarily from the Karnataka government. Additionally, Denta Water is expanding its reach to potential regions such as Gujarat, Madhya Pradesh, Maharashtra, and Uttar Pradesh.
The company’s asset-light model, which focuses on joint ventures and development management, reduces capital expenditure and enhances project execution. This approach has resulted in a debt-equity ratio of 0 for the first half of the financial year 2025.
Denta Water’s strategic focus on water management projects, a strong order book, and expanding market opportunities position it well for continued growth in the water management and infrastructure sectors.
What Should Investors Do Post Listing?
The analyst recommends that investors holding allocated shares maintain their positions with a medium- to long-term outlook.
Shivani Nyati of Swastika Investmart also highlighted the significant investor interest in the Denta Water and Infra Solutions Ltd. IPO, noting a robust 221 times subscription and a strong grey market premium (GMP) of 30%. She suggests that the IPO offers potential for both listing gains and long-term investment opportunities, considering the company’s financial performance and potential risks.
The IPO was priced between Rs 279-294 per share.
Denta Water will use the proceeds from the fresh issue to fund working capital needs, with Rs 150 crore allocated for this purpose. Of this, Rs 50 crore is planned for the current financial year and Rs 100 crore for the next.
