Annu Projects listed on the NSE this morning at ₹72 against an issue price of ₹99 — a 27.27% discount, per Business Standard. On the BSE it opened at ₹75 (−24.24%) and touched a low of ₹71.25. The lot size was 151 shares, so anyone who got a single allotment was down about ₹4,077 before they'd had a chance to do anything about it.

A mainboard IPO opening a quarter below its price is rare. Here's what actually caused it.

Why it moved

1. The institutional book was thin. The issue was subscribed 2.93 times overall, which sounds fine. Break it up and it isn't: QIB 1.72x, NII 3.55x, retail 2.68x. QIB is the qualified institutional buyer slice — mutual funds, insurers, foreign funds. When institutions barely cover their portion, there is no deep pocket sitting under the stock on listing day, and the first sellers set the price on their own.

2. The grey market had already turned negative — just not enough. InvestorGain's tracker showed a GMP of −₹7 ahead of listing, implying an open near ₹92. The direction was right. The size was off by 20 rupees a share. That gap is the useful lesson: GMP is an unofficial quote from a handful of dealers, and it prices sentiment, not the order book. It is not a forecast.

3. The tape was ugly, but that's the smallest piece. The Sensex fell several hundred points today after fresh US–Iran strikes around the Strait of Hormuz pushed Brent to roughly $95, a six-week high, and lifted bond yields. A risk-off session is a bad day to debut — but it explains a few percent, not 27.

The business

Annu Projects has been around since 2003 and builds utilities infrastructure — it lays the stuff under roads. FY26 revenue split, as reported by Business Standard: sewerage 52.67%, telecom 41.50%, gas pipelines 4.03%, other 1.80%. It runs a fleet of 558-plus machines. So this is not a telecom play or a water play; it's a two-legged contractor, and both legs are government-adjacent.

• Order book: ₹938.65 crore, with stated project visibility of ₹1,959 crore.
• Revenue grew from ₹182.35 crore in FY25 to ₹244.59 crore in FY26 (+34%); net profit from ₹21.10 crore to ₹33.03 crore (+57%), per Chittorgarh's RHP summary.
• ROE 21.27%, EBITDA margin 20.81%.
• The concentration: government clients were up to 65% of FY26 revenue, and the top 10 customers were roughly 98% of FY25–26 revenue. The company's own site names BSNL, Bharat Broadband Network, BUIDCO and Bharti Airtel among its customers.

Is it expensive?

At the ₹99 issue price, post-issue EPS of ₹5.04 put the IPO at a P/E of 19.6x and a market cap of about ₹648 crore. For a business compounding profit at 57% with 21% ROE, 19.6x isn't outrageous — but it left no cushion for a contractor whose main risk is cash, not orders. At ₹72 the same earnings base works out closer to 14x, and roughly ₹471 crore of market cap.

For scale, the obvious listed comparable on the water and sewerage side is VA Tech Wabag: market cap about ₹12,582 crore on a P/E of 31.6, as reported by Screener.in. Annu is now at under half that multiple — but Wabag is roughly 20 times its size with a global order book and a long execution record, so the discount is not free money. Chittorgarh's peer set makes the same point differently: recent construction listings sit anywhere between about 14.7x (Technocraft Ventures) and 33.8x (Solarworld Energy Solutions). This sector does not have one "right" multiple.

Who it touches

• Allottees — about ₹4,077 per lot underwater at the NSE open.
• The IPOs standing in the queue behind it — Deepa Jewellers, Purple Style Labs and Rays of Belief are all in the market this week. A mainboard issue opening at −27% resets what a "comfortable" GMP is worth to a retail bidder.
• Anyone who reads GMP as a price target — today it was directionally right and quantitatively useless.
• Listed EPC peers — there's now a cheaper small-cap comparable in telecom and sewerage contracting for anyone building a valuation screen.

What to watch

Cash, not orders. The ₹938.65 crore order book is about 3.8 times FY26 revenue, which is healthy visibility. But Business Standard flagged weak operating cash flows driven by working-capital demands and delayed receivables — and ₹115 crore of the ₹175 crore raised is earmarked for working capital, with ₹15.41 crore for machinery. That allocation tells you where the strain is.

The single thing that would flip this: receivables from government clients actually converting. If they do, 14x earnings on 21% ROE and a 3.8x book is a genuinely different conversation. If collections keep stretching, a cheap multiple is just the market pricing the cash that never arrives — and with the top 10 customers at 98% of revenue, losing one of them does far more damage than a bad listing day.

As of 2:45 pm IST, 2 September 2026. Sources: Business Standard, Business Standard (Capital Market), Business Today, Free Press Journal, Chittorgarh, InvestorGain, Screener.in. For discussion and education only — not investment advice. Verify before acting.