JSW Infrastructure IPO Day 2: The JSW Infrastructure public issue received a good investor response on the second day of subscription as well. JSW Infrastructure IPO was subscribed 2.14 times on day 2. The book build issue will remain open for subscribers till Wednesday, September 27, 2023. JSW Infrastructure Limited aims to raise Rs 2,800 crore from its initial offer, which will be 100 per cent fresh in nature. The public offer is proposed for listing on BSE and NSE.
Key Points Investors Should Know:
JSW Infrastructure IPO Subscription
JSW Infrastructure IPO was subscribed 2.14 times on day 2. JSW Infra IPO’s retail investors portion was subscribed 4.55 times, NII portion was subscribed 3.70 times, and Qualified Institutional Buyers (QIB) portion was subscribed 55%.
JSW Infrastructure IPO Price Band
The price band for the offer has been set at Rs 113-119 per share.
JSW Infrastructure IPO Size
The company plans to mop up Rs 2,800 crore from the public issue at the upper price band. The IPO comprises only a fresh issue component by the company and it does not have an offer-for-sale portion.
Out of the total offer size, Rs 1,260-crore was raised by the company from several anchor investors on September 22, including Monetary Authority of Singapore, Morgan Stanley, the Government of Singapore, HSBC, The Master Trust Bank of Japan, Goldman Sachs, Theleme India Master Fund, Principal Global, Sunil Singhania-owned Abakkus, LIC Mutual Fund, SBI Mutual Fund, ICICI Prudential Mutual Fund, HDFC Mutual Fund, Aditya Birla Sun Life Trustee, and Max Life Insurance Company.
JSW Infrastructure IPO Objectives of Fresh Issue
The net issue proceeds will be used to repay debts amounting to Rs 880 crore, and Rs 1,029.04 crore will be spent on expansion or upgrade works at Jaigarh Port, owned by subsidiary JSW Jaigarh Port. The company had a total consolidated debt at Rs 4,228.39 crore as of June 2023.
Further, the fresh issue proceeds will also be used for the expansion at Mangalore Container Terminal (Mangalore container project) owned by subsidiary, JSW Mangalore Container Terminal at a cost of Rs 151.05 crore. And the remaining amount will be used for general corporate purposes.
JSW Infrastructure IPO Lot Size
Investors can bid for a minimum 126 equity shares, i.e. one lot and in multiples of 126 shares thereafter. The minimum application amount for retail investors works out to be Rs 14,994 (for 126 shares) and their maximum investment is Rs 1,94,922 (1,638 shares) as they can not exceed the investment limit of Rs 2 lakh.
JSW Infrastructure: About the Company
JSW Infrastructure provides maritime-related services, including, cargo handling, storage solutions, logistics services and other value-added services to customers. Its ports and port terminals typically have long concession periods ranging between 30 to 50 years, providing it with long-term visibility of revenue streams.
JSW Infrastructure Financial Performance
JSW Infrastructure’s revenue from operations recorded a CAGR of 41.15 per cent during FY21-FY23, and profit after tax averaged a growth rate of 62.28 per cent in this period.
On a year-on-year basis, the net profit at Rs 749.5 crore for the year ended March FY23 increased by 126.8 per cent and revenue from operations jumped 40.5 per cent to Rs 3,194.7 crore during the same period.
In the quarter ended June FY24, the company’s net profit grew 67.3 per cent on-year to Rs 322.2 crore and revenue increased by 7.1 per cent to Rs 878 crore compared to June FY23 quarter.
JSW Infrastructure IPO: GMP
JSW Infrastructure IPO GMP today or or grey market premium is +19 similar to the previous trading session. This indicates JSW Infra share price were trading at a premium of Rs 19 in the grey market on Wednesday.
Considering the upper end of the JSW Infrastructure Limited IPO price band and the current premium in the grey market, the estimated listing price of JSW Infra share price is Rs 138 apiece, which is 15.97% higher than the IPO price of ₹119.
‘Grey market premium’ indicates investors’ readiness to pay more than the issue price.
JSW Infrastructure IPO Share Allotment & Listing
The basis of the allotment of IPO shares will be finalised by the company in consultation with the BSE by October 3, and the shares will be credited to the demat accounts of eligible investors by October 5. The Initiation of refunds (if any, for anchor investors) or unblocking of funds from the ASBA account will take place by October 4.
The trading in the equity shares of JSW Infrastructure on the BSE and NSE will be commenced with effect from October 6, as per the IPO schedule.
JM Financial, Axis Capital, Credit Suisse Securities (India), DAM Capital Advisors, HSBC Securities and Capital Markets (India), ICICI Securities, Kotak Mahindra Capital Company and SBI Capital Markets are the book-running lead managers to the issue. Kfin Technologies is the registrar of the offer.
Should You Invest?
Most analysts recommended a subscribe rating to the IPO on the company’s decent financial track record and fair valuations. They believe the company will benefit from the government’s focus on port development, limited competition and strong parentage.
JSW Infrastructure Ltd is the port-related infrastructure company with the fastest growth rate, according to brokerage Nirmal Bang. By utilising locational advantage and maximising assets, it has a broad customer base that includes third-party customers from various geographic locations.
“Hence it is able to generate higher EBITDA margins and ROCE compared to Adani Ports. It intends to leverage its presence in the non-major ports to provide fully integrated logistics solutions to its customers. JSW Infrastructure Ltd is being offered at reasonable valuations at 17.2x FY23 EBITDA and thus we recommend subscribing to the issue,” said the brokerage.
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