JSW Infrastructure Limited, India's second-largest commercial port operator, saw a 43% subscription on its Initial Public Offering's (IPO) first day of bidding, which took place on Monday. The strong response was mainly attributed to retail investors who subscribed 1.38 times to the retail portion of the offering. Meanwhile, Non-Institutional Investors and Qualified Institutional Buyers subscribed 0.60 times and 0.03 times respectively.
The company had previously raised Rs 1,260 crore (Rs 1 crore = $120,316) from anchor investors on Sunday, a day before the IPO's opening. Prominent participants included both foreign and domestic institutions such as Morgan Stanley (NYSE:MS), HSBC (LON:HSBA) Global, Theleme, Pictet, SBI Mutual Fund, ICICI Prudential (LON:PRU) Mutual Fund, HDFC Mutual Fund, and Nippon Mutual Fund.
The IPO, which consists of 13,62,83,186 equity shares for bidding, will remain open until Wednesday, September 27, 2023. The price band has been set between Rs 113 ($1 = Rs 83.1) and Rs 119 per share. The company plans to list the equity shares on both BSE and NSE upon issuance.
Several top brokerage firms including Anand Rathi, Reliance Securities, Motilal Oswal, and Nirmal Bang have recommended subscribing to JSW Infrastructure Ltd. They highlighted the company's strategic asset location, predictable revenue streams from long-term concessions and committed long-term cargo along with stable tariffs as key strengths.
These firms also lauded JSW Infrastructure for its proven execution track record and operational capabilities. They acknowledged its expanding third-party business and diversified cargo mix as well as the strong corporate lineage of the JSW Group bolstered by a skilled and experienced management team.
However, they also flagged potential risks associated with the company's high reliance on concession and license agreements from government and quasi-governmental organizations and group companies.
The IPO's book running lead managers include JM Financial Limited, Axis Capital (NYSE:AXS) Limited, Credit Suisse (SIX:CSGN) Securities (India) Private Limited, DAM Capital Advisors Limited, HSBC Securities and Capital Markets (India) Private Limited, ICICI Securities Limited, Kotak Mahindra Capital Company Limited, and SBI Capital Markets Limited. KFin Technologies Limited is serving as the registrar for the offer.
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