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EPC and realty firm Vascon Engineers, which opened its IPO on Wednesday, has priced its issue at Rs 165-185 a share. At the upper end of the price band, HDFC Property Fund is sitting on an unrealised gain of around 43% (27% at the lower end of the band) on its over three-year-old investment in the company.

HDFC Property Fund had initially invested around Rs 138 crore in the company in June-August 2006. Later it participated in a rights issue and is estimated to have invested around Rs 150-152 crore in total in Vascon. It is the single largest non-promoter shareholder of the company having 14.66% (pre-issue) which will get diluted to 12.85% after the IPO.

The company is looking to raise as much as Rs 200 crore from the issue largely to fund its EPC contracts and realty projects besides repayment of debt and other purposes. Kotak Mahindra Capital and Enam Securities are the two book-running lead managers to the issue.

On the first day of the issue-- when the stock markets tanked around 3%-- a quarter of the issue was subscribed by investors. The issue closes on January 29.

At the upper end of the price band, the company will be valued at Rs 1,671 crore while at the lower end of the band, it will command a valuation of Rs 1,490 crore. For the six months ended September'09, Vascon had total income of Rs 319 crore with net profit of Rs 19.3 crore.

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