Afcons Infrastructure IPO: Afcons Infrastructure Limited (AIL) has raised ₹1,621 crore from anchor investors ahead of its IPO subscription opening for bidding. The flagship infrastructure engineering and construction company of the diversified conglomerate Shapoorji Pallonji is all set to hit the D-Street for its three-day subscription on Friday, October 25, and will remain open for investors till Tuesday, October 29, 2024.
The Mumbai-based multinational company allocated over 3.5 crore equity shares to 80 funds at ₹463 apiece, which is also the upper end of the price band. This aggregates the transaction size to ₹1,621.5 crore. Out of the 3.5 crore equity shares, 1.17 crore equity shares worth approximately ₹542.2 crore were allocated to 15 domestic mutual funds through a total of 31 schemes. This accounts for 33.44 per cent of the total anchor book size.
Some of the foreign and domestic institutions participated in the anchor book include HDFC Mutual Fund (MF), ICICI Prudential MF, BlackRock, Fidelity Investments, Goldman Sachs, HSBC Group, Nomura, Nippon India MF, Enam Holdings, Mirae MF, Think Investment, Helios MF, Jain Global, Jane Street, PIMCO, Mahindra, Trust MF, Quant MF, Invesco MF, Eastbridge, Amundi, Invesco HK, SBI General Insurance, among others.
India's leading diversified conglomerate aims to raise ₹5,430 crore via the IPO. The Afcons Infrastructure IPO is a book-built issue of ₹5,430.00 crore. The public issue consists of a fresh issue component worth ₹1,250.00 crore and an offer for sale (OFS) worth ₹4,180.00 crore. The cap price shall be at least 105 per cent of the floor price and shall not be greater than 120 per cent of the floor price. The price band has been fixed at ₹440-463 per share.
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The allotment for the Afcons Infrastructure IPO is expected to be finalized on Wednesday, October 30, 2024. The Afcons Infrastructure IPO will list on BSE and NSE, with a tentative listing date fixed as Monday, November 4, 2024.
Half of the net public issue size (the offer less employees' reservation) has been reserved for qualified institutional buyers (QIBs), some of which may be allocated to anchor investors. 15 per cent of shares are reserved for non-institutional investors (NIIs), and the remaining 35 per cent of shares are for retail investors.
The promoters of the Company are Goswami Infratech Private Limited, Shapoorji Pallonji and Company Private Limited, and Floreat Investments Private Limited, which have a 99.48 per cent holding in the company pre-issue.
ICICI Securities Limited, Dam Capital Advisors Ltd (Formerly IDFC Securities Ltd), Jefferies India Private Limited, Nomura Financial Advisory And Securities (India) Pvt Ltd, Nuvama Wealth Management Limited, and SBI Capital Markets Limited are the book-running lead managers of the Afcons Infrastructure IPO, while Link Intime India Private Ltd is the registrar for the issue.
The selling shareholder will receive the proceeds from the OFS, and Afcons Infrastructure will not receive any. Goswami Infratech Pvt Ltd, a promoter group company, is selling shares through OFS. Of the total proceeds from the fresh issue of shares, Afcons Infrastructure has proposed to use ₹80 crore for capital expenditure to purchase construction equipment.
It will use ₹320 crore towards funding long-term working capital requirements. Around ₹600 crore will be used for prepayment or scheduled repayment of a portion of certain outstanding borrowings. The remaining funds will be for general corporate purposes.
Established in 1959, Afcons Infrastructure has a legacy of over six decades and operates in infrastructure sectors, including marine, surface transport, urban infrastructure, hydro, underground projects, and oil and gas initiatives.
"We have a strong track record of executing numerous complex, challenging and unique engineering, procurement and construction (EPC) projects both within India and internationally," said Afcons Infrastructure Ltd in its red herring prospectus.
As of June 30, 2024, Afcons Infrastructure had 65 active projects across 12 countries in Asia, Africa and the Middle East, aggregating to an order book of ₹34,888 crore. During the last 11 financial years and the three-month period ending June 30, 2024, Afcons has completed 79 projects across 17 countries with a total historic executed contract value of ₹56,305 crore. Afcons Infrastructure Ltd's projects cover five major infrastructure business verticals.
Afcons’ restated consolidated revenue from operations for the fiscal year 2023 rose by 14.69 per cent, reaching ₹12,637.38 crore, up from ₹1,018.97 crore the previous year. Net profit increased by 14.89 per cent, climbing from ₹357.60 crore in FY22 to ₹410.86 crore in FY23. For the six months ending September 30, 2023, the revenue from operations was ₹6,505.39 crore, while net profit stood at ₹195.13 crore.
These include marine and industrial projects, covering ports, harbour jetties, dry docks, wet basins, breakwaters, outfall and intake structures, liquefied natural gas tanks, and material handling systems. The projects are in surface transport, covering highways and roads, interchanges, mining-related infrastructure, and railways. The urban infrastructure projects cover elevated and underground metro works, bridges, flyovers, and elevated corridors.
Afcons implements hydro and underground projects, including dams and barrages, tunnels (including large road tunnels), underground works, water, and irrigation. Afcons Infrastructure takes projects in the oil and gas segment, covering both offshore and onshore oil and gas projects.
Founded in 1865, Shapoorji Pallonji Group (SP Group) is a diversified institution and has a leading presence in engineering & construction, infrastructure, real estate, water, energy and financial services sectors across the globe.
