Afcons Infrastructure IPO: Shapoorji Pallonji Group Firm Fixes Price Band; Check Latest GMP & Dates Here

The initial public offering (IPO) of Afcons Infrastructure, a player in the engineering and construction sector under the Shapoorji Pallonji Group, is set to open for subscription on October 25. The IPO will remain open for bidding until October 29, giving investors a five-day window to participate in this market event.

Afcons Infrastructure aims to raise approximately Rs 5,430 crore through this IPO, which includes a fresh issue of shares valued at Rs 1,250 crore and an offer for sale (OFS) by promoter Goswami Infratech, totalling Rs 4,180 crore. This IPO comes after the company scaled down its original offer size of Rs 7,000 crore due to successful pre-IPO fundraising. The pre-IPO activity helped reduce the overall fundraising target.

IPO Price Band and Lot Size

Afcons Infrastructure has set a price band of Rs 440 to Rs 463 per share for the IPO. Investors can bid for the shares in lots, with one lot comprising 32 shares. This means that the minimum investment required to participate in the IPO will be approximately Rs 14,080, based on the lower end of the price band.

Utilization of IPO Proceeds

The company has outlined a plan for the utilization of funds raised from the fresh issue of Rs 1,250 crore. The proceeds will be allocated as follows:

Rs 80 crore will be used for purchasing construction equipment to enhance operational efficiency.
Rs 320 crore will be directed toward long-term working capital to support the company's large-scale projects.
Rs 600 crore will be allocated for the repayment of debt, a move that will help reduce the company's financial burden.
The remaining funds will be used for general corporate purposes.

Promoter and Ownership Structure

Currently, the promoter and promoter group entities hold a 99% stake in Afcons Infrastructure, a testament to the strong backing from the Shapoorji Pallonji Group. The OFS portion of the IPO, amounting to Rs 4,180 crore, will be driven by Goswami Infratech, the company's primary promoter. This move is part of Afcons' strategy to diversify its ownership and increase liquidity in the market post-listing.

About Afcons Infrastructure

Afcons Infrastructure is well-regarded for its strong track record of executing complex engineering, procurement, and construction (EPC) projects both in India and abroad. The company has demonstrated its ability to deliver challenging projects across a wide range of sectors, including marine and industrial, surface transport, urban infrastructure, hydro and underground, and oil and gas. According to the Fitch Report, Afcons was recognized as one of India's top international infrastructure firms in 2023 by Engineering News-Record (ENR).

In terms of listed industry peers, Afcons compares itself to major players like Larsen & Toubro Ltd (L&T), KEC International Ltd, Kalpataru Project International Ltd, and Dilip Buildcon Ltd. Afcons' portfolio and established reputation in both domestic and international markets position it well to compete with these leading infrastructure firms.

Book-Running Lead Managers

Afcons Infrastructure has enlisted a roster of book-running lead managers for its IPO, ensuring a smooth offering. The lead managers include ICICI Securities, DAM Capital Advisors, Jefferies India, Nomura Financial Advisory and Securities (India), Nuvama Wealth Management, and SBI Capital Markets.

Founded in 1865, the Shapoorji Pallonji Group (SP Group) has established itself as a diversified conglomerate with a leading presence in sectors such as engineering, construction, infrastructure, real estate, energy, water, and financial services. Afcons Infrastructure, as a key subsidiary of the SP Group, has capitalized on this heritage to become a major force in the infrastructure space.