JSW Infrastructure IPO records 17% booking on bidding debut
JSW Infrastructure‘s inaugural public issue has made a noteworthy debut, with a 17 percent subscription rate as of September 25. Investors have submitted bids for approximately 2.29 crore equity shares, while the IPO was structured with a total size of 13.62 crores equity shares. This indicates substantial demand for the offering.
An interesting aspect of this IPO is the broad spectrum of investors who have shown interest. All categories of investors, including retail investors and high net-worth individuals, have actively participated. Retail investors have displayed robust enthusiasm, securing 71 percent of the shares allotted to them, while high net-worth individuals have acquired 14 percent of their allotted quota. This diversity in investor participation signifies a wide appeal for JSW Infrastructure’s public offering and demonstrates confidence in the company’s prospects, marking a significant event in the JSW Group’s history as it represents the company’s first public issue in the last 13 years.
In the public issue of JSW Infrastructure, Qualified Institutional Buyers (QIBs) have subscribed for a nominal portion, equivalent to 0.005 percent of the shares reserved for them. The QIB category typically accounts for 75 percent of the total offer size. Meanwhile, the high net-worth individuals (HNIs) have subscribed to 15 percent of the issue, and the remaining 10 percent is reserved for retail investors.
JSW Infrastructure, a company specializing in port-related infrastructure, has set a fundraising target of Rs 2,800 crore through this issue. The price band for the shares in the IPO is in the range of Rs 113 to Rs 119 per share. It’s important to note that the entire offering consists of a fresh issue component by the company, which means that all proceeds raised from the IPO will be channeled towards the company’s ongoing development and growth initiatives. This approach reflects the company’s intention to utilize the funds to enhance its infrastructure and expand its operations in the port-related sector.
On September 22, JSW Infrastructure successfully secured Rs 1,260 crore from anchor investors, including prominent names like Goldman Sachs, the Government of Singapore, HSBC, and several mutual funds. These funds will serve various purposes in alignment with the company’s growth and development plans.
A significant portion, Rs 880 crore, will be dedicated to debt repayment, which will help strengthen the company’s financial position. Additionally, JSW Infrastructure has earmarked Rs 1,029.04 crore to fund expansion and upgrade works at Jaigarh Port, a subsidiary owned by the company. This investment is aimed at enhancing the capabilities and infrastructure of the port.
The company’s subsidiary, JSW Mangalore Container Terminal, will receive Rs 151.05 crore for the Mangalore Container Terminal project, facilitating its growth and development. The remaining funds will be allocated for general corporate purposes, covering a range of operational and corporate initiatives.
This strategic allocation of funds reflects JSW Infrastructure’s commitment to utilizing the proceeds from the IPO to achieve its growth objectives, reduce debt, and bolster its position in the port-related infrastructure sector.
JSW Infrastructure, a company providing maritime-related services such as cargo handling, storage solutions, logistics services, and other value-added services, is set to conclude its public issue on September 27.
From a financial perspective, the company has demonstrated robust growth, with its revenue from operations achieving a Compound Annual Growth Rate (CAGR) of 41.15 percent between FY21 and FY23. Furthermore, its profit after tax recorded an impressive CAGR of 62.28 percent during the same period.
Following the closure of the IPO, JSW Infrastructure plans to work in consultation with the Bombay Stock Exchange (BSE) to finalize the basis of allotment for IPO shares by October 3. Subsequently, the trading of JSW Infrastructure’s equity shares on both the BSE and NSE is scheduled to commence on October 6, as per the IPO schedule.
Analysts have noted that JSW Infrastructure’s equity shares have been trading at approximately a 12 percent premium over the upper price band in the grey market, which serves as an unofficial platform for trading IPO shares until the official listing. This premium indicates strong investor interest in the company’s IPO.
