Afcons Infrastructure IPO: GMP Turns Negative Ahead Of Listing On November 4, Check Latest Updates

Afcons Infrastructure is set to make its public debut with its IPO listing scheduled for Monday, November 4, after completing a successful allotment process. Shares were allocated on October 31, marking the end of the IPO journey that began with its subscription phase on October 25 and concluded on October 29. In total, the IPO received a subscription of 2.63 times its offered shares.

The segment-wise subscription details revealed a varying level of enthusiasm across investor categories. Retail investors subscribed to the IPO at a rate of 94%, reflecting significant but not overwhelming interest from individual buyers. Non-institutional investors (NIIs) demonstrated stronger enthusiasm, with their segment subscribed at 5.05 times, while qualified institutional buyers (QIBs) marked a subscription of 3.79 times. Additionally, the employee segment of the offering was oversubscribed by 1.67 times. The initial two days of bidding, however, saw a slower response, with just a 10% subscription on the first day and a slight rise to 36% on the second day.

Afcons Infrastructure raised Rs 1,621 crore from anchor investors, signalling strong early support. The IPO was structured with 50% of shares allocated to QIBs, 15% to non-institutional investors, and the remaining 35% for retail investors. Employees were offered a discount of ₹44 per share, with the IPO priced within a band of Rs 440 to Rs 463 per share. With a face value of Rs 10 and a lot size of 32 shares, the IPO saw a favourable setup for diverse investor participation.

In the grey market, Afcons Infrastructure shares have seen fluctuating premium activity. Today's grey market premium (GMP) is at a modest discount of Rs 3, placing its estimated listing price around Rs 460 per share, slightly below the upper IPO price band of Rs 463. This discount reflects a 0.65% drop, indicating a cautious sentiment among grey market investors ahead of the listing. Experts report that over the past 34 sessions, the GMP for Afcons Infrastructure has ranged widely, from a low of Rs -3 to a high of Rs 225, suggesting varied investor expectations for the IPO's market debut. The current negative GMP, although modest, may hint at a listing price under pressure in the initial trading hours.

The IPO includes a fresh issuance worth Rs 1,250 crore and an offer-for-sale component valued at Rs 4,180 crore by the promoter, Goswami Infratech, as well as other major stakeholders, including Shapoorji Pallonji and Company, Floreat Investments, Hermes Commerce, and Renaissance Commerce. These shareholders collectively hold a 99% stake in Afcons Infrastructure, with the remaining 1% held by public investors. Post-listing, the company plans to utilize a portion of the fresh proceeds-Rs 80 crore-for acquiring construction equipment, while Rs 320 crore is earmarked for long-term working capital requirements. Afcons also aims to allocate Rs 600 crore for debt repayment, with the remaining funds designated for general corporate purposes.

Afcons Infrastructure has engaged book-running lead managers, including ICICI Securities, Dam Capital Advisors, Jefferies India, Nomura Financial Advisory and Securities, Nuvama Wealth Management, and SBI Capital Markets, to guide the IPO process. Link Intime India Private Ltd serves as the issue's registrar.

As Afcons Infrastructure makes its debut on the stock market, its performance will be closely monitored by investors, particularly those who participated in the IPO. The company's strategic fund allocation aims to bolster its operational capabilities, reduce debt, and support corporate objectives. However, the cautious grey market premium suggests that initial market sentiment may lean towards a modest valuation.