Whalesbook
Rajesh Power Services Ltd has confirmed that its ₹160.47 crore Initial Public Offer (IPO) funds were utilized exactly as planned, with no deviation. The company's Audit Committee and Board have approved a statement showing that lower-than-expected IPO expenses resulted in an ₹8.57 crore surplus. This surplus has now been strategically allocated to bolster the company's working capital.
The confirmation comes via a filing detailing the company's Statement of Deviation or Variation for the IPO proceeds. The total funds raised included ₹93.47 crore from a fresh issue and ₹67.00 crore from an offer for sale. Actual expenses incurred for the IPO were ₹14.34 crore, falling below the initial estimate of ₹15.50 crore.
These cost savings directly led to the unutilized surplus of ₹8.57 crore. Rajesh Power Services has decided to deploy this additional amount to meet its working capital requirements, a move that can enhance operational flexibility and support ongoing business needs.
The company, which went public with shares allotted on November 28, 2024, had originally planned to use the IPO funds for various capital expenditures. These included purchasing new equipment, establishing a solar power plant, and building expertise in green hydrogen, alongside general corporate purposes and initial working capital needs. Rajesh Power Services, established in 1971, is a notable EPC contractor in the power sector with a significant order book.
This adherence to planned fund utilization and the transparent reporting of the surplus reinforce investor confidence in the company's governance and financial management.
Operating within the power EPC sector, Rajesh Power Services' peers include companies like KEC International Ltd and Kalpataru Projects International Ltd, both active in power transmission and distribution EPC. Other infrastructure and utilities firms, such as Skipper Ltd and HG Infra Engineering Ltd, also operate in related areas, albeit with potentially different business models.
Investors will likely track the company's continued project execution, the impact of the allocated working capital on operational efficiency and liquidity, and its future financial performance and growth guidance. Monitoring any new project wins and the broader market conditions affecting the power EPC sector will also be key.