Afcons Infrastructure Limited’s IPO, a company working in the transport, construction, oil and gas sector, will open on October 25. Investors will be able to bid for this issue till October 29. The company’s shares will be listed on the Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) on October 4.
The company wants to raise Rs 5,430 crore through this issue. 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 an Offer for Sale i.e. OFS.
What is the minimum and maximum amount that can be invested?
Afcons Infrastructure Limited has fixed the price band of this issue at 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 pay 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.
35% of the issue is reserved for retail investors
The company has reserved 50% of the issue for qualified institutional buyers (QIB). Apart from this, about 35% is reserved for retail investors and the remaining 15% is reserved for non-institutional investors (NII).
Afcons Infrastructure will spend Rs 600 crore for corporate purposes
The company will use up to Rs 80 crore from the funds raised from the fresh issue to purchase construction equipment, allocate Rs 320 crore for funding working capital requirements, and deploy Rs 600 crore for prepayment or scheduled repayment of a portion of certain outstanding borrowings it availed and for general corporate purposes.
Afcons Infrastructure operates five major infrastructure businesses:
- Marine & Industrial- This includes projects such as ports, harbours, 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 & Underground Projects- This includes dams, tunnels, and water related projects.
- Oil & Gas- This includes offshore and onshore projects in the oil and gas sector.
AIL’s operating revenue in FY 2023 is 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.
The Fitch report states that among the country’s large infrastructure companies, Afcon leads in Return on Capital Employed (ROCE), which measures return against cost and EBITDA margin. According to the data for 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 of June 30, 2024, Afcon Infrastructure has an order book of 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 Initial Public Offering or 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.
