Key Points
- Afcons Infrastructure IPO priced at ₹440-463 per share.
- IPO opens October 25 and closes October 29.
- IPO size reduced to ₹5,430 crore.
- Goswami Infratech, the promoter, is selling more shares through pre-IPO placement.
- Recent credit rating downgrade to BB- due to high debt.
- Funds will be used for debt repayment and capital expenses.
- Strong order pipeline with significant projects underway.
Looma News
Afcons Infrastructure is gearing up for its IPO, and they’ve set the price between ₹440 and ₹463 per share. If you’re interested, mark your calendars because it will open on October 25 and will close on October 29.
They’ve also decided to cut the IPO size down to ₹5,430 crore from a whopping ₹7,000 crore. The reason? Well, the promoter, Goswami Infratech, is selling off even more shares through a pre-IPO placement, which is expected to bring in around ₹7,147 crore. They’ve got some big-name investors onboard, including sovereign funds and mutual funds, which should help meet the demand from institutional investors.
Facing Challenges
But it’s not all smooth sailing for them. Goswami Infratech is carrying a fair bit of debt and recently got an extension on repayment for its non-convertible debentures (NCDs) until December 31, 2024. This led to CARE Ratings downgrading their credit rating to BB-. The money raised from this IPO and pre-IPO placement will mainly go towards tackling that debt.
Utilization of Funds
So, how are they planning to use the fresh funds? ₹80 crore will be used to buy new construction equipment, ₹320 crore is set aside for long-term working capital, and ₹600 crore will help pay off existing loans. The rest will cover general corporate expenses.
Future Prospects
On a brighter note, by the end of March, Afcons had a massive order book of over ₹31,000 crore, and they’ve added another ₹19,000 crore worth of projects just this fiscal year. Among these are the tunneling project for the Mumbai to Ahmedabad bullet train and a huge $500 million project connecting four islands in the Maldives. It looks like Afcons is not just preparing for its IPO but also building a solid future.
