JSW Infrastructure IPO: 37x subscription on last day
JSW Infrastructure, a leading port-related infrastructure company, has seen its initial public offering (IPO) subscribed 37.37 times on the final day of bidding. The retail investors' portion has been oversubscribed by 10.31 times, while non-institutional investors (NII) subscribed 15.99 times. Qualified institutional buyers (QIB), having the maximum quota of 75% in the offer, have subscribed 57.09 times so far.
Company overview
JSW Infrastructure is a company focused on port-related infrastructure, offering cargo handling, storage solutions, logistics services, and various value-added services to its clients. The company's IPO consists solely of a fresh issuance of shares valued at Rs. 2,800 crore, with no offer-for-sale component. The company's installed cargo handling capacity in India has grown at a CAGR of 15.27% from 119.23 MTPA in March 2021 to 158.43 MTPA in March 2023.
IPO proceeds to fund debt reduction and expansion
The entire fresh issue proceeds, excluding IPO expenses, will go to the maritime-related services company. JSW Infrastructure plans to reduce its debt burden by Rs. 880 crore using the fresh funds. Additionally, Rs. 1,029.04 crore will be allocated for expansion or upgradation works at Jaigarh Port and Rs. 151.05 crore for the Mangalore Container Terminal. The remaining amount will be used for general corporate purposes.
Impressive growth rate
JSW Infrastructure has recorded a 62.3% CAGR growth in net profit during FY21-FY23 and a 41% CAGR growth in revenue from operations during the same period. The market capitalization post-issue, at the upper price band, will be Rs. 24,990 crore, while peer Adani Ports has a market cap of Rs. 1.79 lakh crore as of today. The company will finalize the basis of allotment of IPO shares by October 3, with trading commencing on October 6.
JSW Infrastructure IPO GMP today
The grey market premium (GMP) for JSW Infrastructure's IPO is reported to be approximately Rs. 23, as per ipowatch.com. Based on this GMP and considering the upper end of the IPO price band, it is estimated that the listing price for JSW Infrastructure's shares could be around Rs. 142 apiece. This represents a premium of 19.32% compared to the IPO price of Rs. 119. The GMP indicates investors' willingness to pay a premium over the issue price.
