Mahendra Realtors & Infrastructure

• Mahendra Realtors & Infrastructure is coming out with an initial public offering (IPO) of 58,17,600 equity shares in a price band Rs 75-85 per equity share.
• The issue will open on August 12, 2025 and will close on August 14, 2025.
• The shares will be listed on SME Platform of NSE.
• The face value of the share is Rs 10 and is priced 7.50 times of its face value on the lower side and 8.50 times on the higher side.
• Book running lead manager to the issue is Fast Track Finsec.
• Compliance Officer for the issue is Niharika Kothari.

Profile of the company

Mahendra Realtors & Infrastructure is engaged in providing a wide variety of services including but not limited to structural repairs, rehabilitation, retrofitting, water proofing, corporate interior, build-operate-transfer (bot) projects, maintenance, construction, infrastructure restoration etc.

The company has undertaken several Structural repairs projects for various government departments and public sectors organizations, for example, Structural Repairs projects at CIDCO Vashi Railway Station and Belapur Railway Station undertaken by deploying various latest innovative techniques viz. Polymer Modified Mortar, micro concrete, Injection Grouting, Texture, Huge waterproofing with heat insulation etc., structural repairs at Ghatkopar wherein Structural Stability Certificate was issued by IIT Bombay, in which Steel Jacketing was carried out along with Fabre wrapping, External Repairs, Retrofitting and Restoration works at SBI Harbour heights etc. 

Further, the company has successfully completed various corporate interior projects at IIT Bombay, Airport Authority of India, VVIP Circuit house, Pune, SVP Hospital at Ahmedabad and likewise other major projects. It has an overall track record of completion of more than 200 projects for over 50 clients and an average rate of completion of projects within the allotted time.

Proceed is being used for:

• Meeting working capital requirements of the company
• Meeting general corporate purposes
• Meeting issue expenses

Industry Overview

India’s high growth imperative in 2023 and beyond will significantly be driven by major strides in key sectors with infrastructure development being a critical force aiding the progress. Infrastructure is a key enabler in helping India become a $26 trillion economy. Investments in building and upgrading physical infrastructure, especially in synergy with the ease of doing business initiatives, remain pivotal to increasing efficiency and costs. The sector is highly responsible for propelling India’s overall development and enjoys intense focus from the Government for initiating policies that would ensure the time-bound creation of world-class infrastructure in the country. The infrastructure sector includes power, bridges, dams, roads, and urban infrastructure development. In other words, the infrastructure sector acts as a catalyst for India’s economic growth as it drives the growth of the allied sectors like townships, housing, built-up infrastructure, and construction development projects. To meet India’s aim of reaching a $5 trillion economy by 2025, infrastructure development is the need of the hour.

In the Interim Budget 2024-25, capital investment outlay for infrastructure has been increased by 11.1% to Rs 11.11 lakh crore ($133.86 billion), which would be 3.4 % of GDP. As per the Interim Budget 2023-24, a capital outlay of Rs 2.55 lakh crore ($30.72 billion) has been made for the Railways, an increase of 5.8% over the previous year. Starting with 6,835 projects, the NIP project count now stands at 9,142 covering 34 sub-sectors, as per news reports. Under the initiative, 2476 projects are under the development phase with an estimated investment of $1.9 trillion. Nearly half of the under-development projects are in the transportation sector, and 3,906 are in the roads and bridges sub-sector. During FY 2023-24, the Total revenue of Indian Railways stands at $28.89 billion (Rs 2.40 lakh crore) as on 15th March. Last year on 15th March, total Revenue was $26.84 billion (Rs 2.23 lakh crore).

With a 37% increase in the current fiscal year, capital expenditures (capex) are on the rise, which bolsters ongoing infrastructure development and fits with 2027 goals for India's economic growth to become a $5 trillion economy. In order to anticipate private sector investment and to address employment and consumption in rural India, the budget places a strong emphasis on the development of roads, shipping, and railways. Global investment and partnerships in infrastructure, such as the India-Japan forum for development in the Northeast are also indicative of more investments. These initiatives come at a momentous juncture as the country aims for self-reliance in future-ready and sustainable critical infrastructure. Further, India being a developing nation is set to take full advantage of the opportunity for the expansion of the infrastructure sector, and it is reasonable to conclude that India's infrastructure has a bright future ahead of it.

Pros and strengths

Established reputation: It is a critical strength for a company because it fosters trust, attracts customers and partners, enhances employee satisfaction and provides a buffer during difficult times, all of which contributes to the long-term success and stability of the business. The company’s strong track record and experience in delivering successful government projects helps in building trust amongst customers.

Strong network: The company has established strong relationships and connections within government agencies and with industry partners. These relationships provide critical advantages in securing contracts, gathering market intelligence, navigating the procurement process, and fostering collaboration with other entities. The network plays a key role in helping the company to identify opportunities, enhance their reputations and build long-term business growth in the government sector.

Financial Stability: The company has ability to maintain solid financial health, ensuring it has the necessary resources to invest in projects, manage operational costs, and endure economic fluctuations or unexpected financial challenges. In the context of government contracting, financial stability is a critical strength that enables companies to meet the demand of large, often long-term government contracts, as well as adapt to the complexities and uncertainties inherent in these contracts.

Risks and concerns

Maximum revenue comes from limited customers: The company has garnered 81.29%, 70.65% and 86.62% of its total revenue from top 10 customers in FY25, FY24 and FY23 respectively. It has not entered into long term agreements with its customers and the success of its business is accordingly significantly dependent on it maintaining good relationships with them. The loss of one or more of these significant customers or a reduction in the amount of business it obtains from them could have an adverse effect on its business, results of operations, financial condition and cash flows.

Geographical constrain: The company presently has a concentration of customer base and revenue majorly in the state of Maharashtra. The revenue earned in the state in March 2025, March 2024, and March 2023 is Rs 12047.27 lakh (96.55%), Rs 8946.38 lakh (88%) and Rs 4,769.49 lakh (76%) respectively. It is aware that if a company's customer base is heavily concentrated in a specific region, it becomes more vulnerable to economic changes, local market conditions, or geopolitical events that may affect that particular area. Further, economic downturns could disproportionately impact the purchasing power of customers in that region.

Top ten suppliers contribute significant part of its purchases: The company’s top ten suppliers contributed approximately 42.94%, 39.03% and 41.01% of its total purchases for the financial year ended March 31, 2025, March 31, 2024 and March 31, 2023 based on Restated Financial Statements. However, its top suppliers may vary from period to period depending on the demand-supply mechanism and thus the supply process from these suppliers might change as it continues to seek more cost effective suppliers in the normal course of business. Since its business is concentrated among relatively few significant suppliers, it could experience a reduction in its purchases and business operations if it loses one or more of these suppliers, including but not limited on account of any dispute or disqualification.

Outlook

Mahendra Realtors & Infrastructure provides various services, including Structural Repairs, Rehabilitation, Retrofitting, Waterproofing, Corporate Interiors, BOT Projects, Maintenance, Construction, and Infrastructure Restoration. The company has established reputation contributing to the long-term success and stability of the business. It specializes in procurement, ensuring compliance, managing risks, controlling budgets, and meeting deadlines and quality standards by adhering to ISO. On the concern side, the company’s top 10 customers contribute more than 50% of the revenue in the all three financial years. The loss of any one or more of its major customers would have a material adverse effect on its business, cash flows, results of operations and financial condition. Moreover, the geographical concentration of its customer base may restrict its operations and adversely affect its business, results of operations, and financial conditions in the future.

The company is coming out with a maiden IPO of 58,17,600 equity shares of Rs 10 each. The issue has been offered in a price band of Rs 75-85 per equity share. The aggregate size of the offer is around Rs 43.63 crore to Rs 49.45 crore based on lower and upper price band respectively. On performance front, the company’s revenue from operations increased 22.94% to Rs 12,477.18 lakh in FY25 as compared to Rs 10,148.98 lakh in FY24. Moreover, the company reported 28.40% rise in its net profit at Rs 1,486.63 lakh in FY25 as compared to Rs 1,157.83 lakh in FY24.

The company sees substantial growth potential within its current client base. It is adding more verticals to cater its clients and also venture into waste field. It plans to use its industry expertise, deep understanding of its target sectors, and strong client relationships to expand its current services and venture into new areas and industries. To achieve this, it will further develop its management teams embedded within client organizations by focusing on leadership development, skill enhancement, and alignment with client-specific goals. To support this, it engaged an Organizational Development Coach to train its employees, enhancing their skills and driving business growth while fostering closer ties and identifying fresh business prospects.