Afcons- Today is the last day to bid for the IPO of Afcons Infrastructure Limited, a company operating in the transport, construction, oil and gas sector. By 4 pm, investors subscribed to this issue a total of 2.75 times. Retail investors subscribed 0.95 times, qualified institutional buyers (QIB) subscribed 3.99 times, and non-institutional investors (NII) subscribed 5.31 times.
The company’s shares will be listed on the Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) on November 4. Through this issue, the company wants to raise Rs 5,430 crore. For this, the company is issuing 2,69,97,840 fresh shares worth Rs 1,250 crore. Whereas, the existing investors of the company are selling 9,02,80,778 shares worth Rs 4,180 crore through Offer for Sale i.e. OFS.
How much minimum and maximum money can be invested in Afcons?
Afcons Infrastructure Limited has fixed the price band of this issue from Rs 440 to Rs 463 per share. Retail investors can bid for a minimum of one lot i.e. 32 shares.
If you apply for 1 lot as per the upper price band of IPO of Rs 463, then you will have to invest Rs 14,816 for it.
At the same time, retail investors can apply for a maximum of 13 lots i.e. 416 shares. For this, investors will have to invest Rs 1,92,608 as per the upper price band.
Retail investors reserve 35% of the issue.
The company has reserved 50% of the issue for Qualified Institutional Buyers (QIB). Retail investors receive about 35% of the allocation, while non-institutional investors (NII) receive the remaining 15%.
Afcons will spend Rs 600 crore for corporate purposes
The company will use up to Rs 80 crore from the funds raised through the fresh issue to purchase construction equipment, allocate Rs 320 crore for funding its working capital requirements, and direct Rs 600 crore towards prepaying or scheduled repayment of a part of its outstanding borrowings, as well as for general corporate purposes.
Afcons operates five major infrastructure businesses:
- Marine and Industrial – This includes projects such as ports, harbors, dry docks, LNG tanks and material handling systems.
- Surface Transport – This includes highways, interchanges, mining infrastructure and railways.
- Urban Infrastructure – This includes metro works, bridges, flyovers and elevated corridors.
- Hydro and underground projects – These include dams, tunnels, and water related projects.
- Oil and Gas – This includes offshore and onshore projects in the oil and gas sector.
- AIL’s operating revenue in FY 2023 was Rs 13,267.50 crore
AIL’s operating revenue increased from Rs 12,637.38 crore in FY 2023 to Rs 13,267.50 crore in 2024. During this period, the company’s profit after tax was Rs 449.74 crore, which was Rs 410.86 crore in FY 2023.
According to the Fitch report, among the country’s large infrastructure companies, Afcon leads in Return on Capital Employed (ROCE), which measures return against cost, and in EBITDA margin. According to the data of FY 2024, the company is at the top in terms of Return on Equity (ROE) and Profit After Tax (PAT).
In the quarter ended June 30, 2024, the company’s operating revenue was Rs 3,154.36 crore and profit after tax was Rs 91.59 crore. As per the data till June 30, 2024, the order book of Afcon Infrastructure is Rs 31,747.43 crore.
What is an IPO?
When a company issues its shares to the general public for the first time, it is called an Initial Public Offering i.e. IPO. The company needs money to expand its business. In such a situation, instead of taking a loan from the market, the company raises money by selling some shares to the public or by issuing new shares. For this, the company brings IPO.
