The initial public offering (IPO) of Afcons Infrastructure, a Shapoorji Pallonji firm, was absolutely subscribed on the closing day of the bidding direction of, following a moderate response in the first two days.
Round 12:50 p.m., the save bought bids for 9,52,55,392 shares, or 1.10 cases in opposition to the total save size of 8,66,19,950 shares. The retail piece was subscribed at 52%, while the qualified institutional buyer's piece was booked 1.11 cases. The allocation for non-institutional investors (NII) was subscribed by 2.42 cases.
Per market analysts, the novel GMP of Afcons Infrastructure is Rs 30 (6.5%) in the unlisted market.
The save, which closes on October 29, is a aggregate of a novel save of shares price Rs 1,250 crore and a advice for sale (OFS) of up to Rs 4,180 crore by promoter Goswami Infratech.
The firm will utilise Rs 80 crore from the novel save proceeds to purchase construction tools, Rs 320 crore for prolonged-time period working capital, Rs 600 crore to repay debt, and the rest for overall corporate functions.
The firm has fastened a stamp band of Rs 440-463 per piece, the save investors can whisper for 32 shares in one lot.
Per market analysts, the novel GMP of Afcons Infrastructure is Rs 30, indicating a premium of 6.5% to the save.
Analysts suggested investors to subscribe to the save for the prolonged time period because the firm boasts of a solid, varied swap mannequin with a stable describe ebook and constant financial efficiency in the infrastructure sector.
"Key strengths encompass strategic tools investments, but challenges similar to low PAT margins and reliance on executive capex exist. Whereas management specializes in prolonged-time period asset utilization, backed by Shapoorji Pallonji, investors dangle to be responsive to dangers associated to capex dependency and profit margins. We counsel subscribing to this save for prolonged-time period gains," mentioned Canara Financial institution Securities.
"Accomplished a mountainous replace of infamous infrastructure initiatives. Solid describe ebook supports future enhance. Proper financial efficiency over time. IPO is affordable. Long-time period potentialities search promising, but list efficiency will be impacted by recent market prerequisites," mentioned Swastika Investmart.
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Afcons Infrastructure has a proven observe file of efficiently handing over a huge selection of complex and demanding engineering, procurement, and construction (EPC) initiatives each and each domestically and internationally. Per the Fitch Document, Afcons is recognized as one of India’s main worldwide infrastructure companies, as per the 2023 rankings by Engineering Info-Account (ENR) in accordance with worldwide revenue for the financial twelve months 2023.
The firm operates across 5 predominant infrastructure swap verticals including marine and industrial, surface transport, urban infrastructure, hydro and underground, and oil and gas.
Primarily based in 1865, Shapoorji Pallonji Neighborhood (SP Neighborhood) is a varied community and has a number one presence in engineering & construction, infrastructure, true estate, water, energy and financial products and services sectors across the globe.
In phrases of listed swap peers, Afcons compares itself with Larsen & Toubro Ltd (L&T), KEC World Restricted (KEC), Kalpataru Project World Ltd (KPIL), and Dilip Buildcon Ltd( DBL).
For the twelve months ending March 2024, the firm's revenue from operations fell marginally to Rs 3154 crore and the profit after tax rose to Rs 91.6 crore from Rs 90.9 crore a twelve months ago.
ICICI Securities, DAM Capital Advisors, Jefferies India, Nomura Financial Advisory and Securities (India), Nuvama Wealth Administration, and SBI Capital Markets are the ebook-working lead managers to the save.
(Disclaimer: Suggestions, suggestions, views and opinions given by the specialists are their have confidence. These develop now not portray the views of The Financial Cases)