Valencia India Limited
Prospectus dated July 1, 2025
Summary
Valencia India Limited is proposing to raise ₹48.95 crore through the IPO: ₹44.00 crore from a fresh issue of shares and ₹4.95 crore through an offer for sale by existing shareholders. The price is ₹110 per share.
About 84% of the amounts stated for the objects go to development of 15 villas and club house, and about 16% to general corporate purposes.
The review found 12 points to read closely and 19 worth checking.
Read closely
- Criminal proceedings
- Land or assets bought from related parties
- Shares issued shortly before the IPO at a deep discount to the issue price
- Litigation exposure
- Tax demands
- Low promoter holding after the issue
- A large object depends on a single vendor's quotation
- Capital expenditure rests on quotations with no orders placed
- No independent monitoring of proceeds
- Issue is large relative to the existing business
- Profit jumped in the year before the IPO
- Weak liquidity
How the capital was built
- The last priced issue of shares was on 5 Mar 2024: 20,000 shares to promoters and others at ₹3,000 each (₹10 in today's shares) (4 allottees), 66.7% of the pre-issue capital, at 300 times the price of the previous issue about 5 years earlier; it came 16 months before this prospectus.
- From the first priced issue (on incorporation, ₹0.033 in today's shares) to the last, the price per share rose 300 times over 5 years.
- The price band of ₹110 to ₹110 is 11.00 to 11.00 times the last issue price.
Conclusion
Of the 12 points to read closely, 6 concern the promoters, management and their dealings (criminal proceedings; land or assets bought from related parties; shares issued shortly before the IPO at a deep discount to the issue price; litigation exposure; tax demands; low promoter holding after the issue), 4 concern how the IPO money will be spent and 2 concern the financial statements. These could not be scored automatically and need reading: promoters have limited experience in this business; proceeds flow to promoters, group entities or related vendors; proceeds spent on property the company does not own. The pages to read are 30, 44, 53, 57, 63, 67, 130, 157 and 172–173.