NEW DELHI :Port operator JSW Infrastructure Ltd on Monday announced plans for a ₹2,800 crore initial public offering (IPO), the first from the JSW Group in 13 years. The IPO will open on 25 September at a price band of ₹113-119 per share, and will be entirely of new shares.
“Big event for the group, it has been very, very categoric, you know, unless you create a business of a certain level and you have an appetite to grow when you see a growth in the sector, then we take public money, and the demand has been very good per se. The company’s coming after 13 years into the IPO market, very sound financials, good governance structures within,” Arun Maheswari, joint MD and CEO of JSW Infrastructure Ltd, said. “The QIB (Qualified Institutional Buyers) portion will be 75% of the offer size which is ₹2,100 crore and of which 60% will be for anchor investors, HNI (High Net-worth Individuals) portion will be 15% ie, ₹420 crore, retail portion will be 10% i.e., ₹280 crore,” he added.
After the listing, the company is expected to have a market capitalisation of ₹25,000 crore at the top end of the price band.
The port operator will be channeling these funds for capital expenditure (capex), debt, etc. “Out of ₹2,800 crore, around ₹1,200 crore will go for capex. Around ₹900 crore will go for repayment of debt and balance ₹700 crore would be for general corporate purpose,” he added.
Post IPO, the company aims to become a net-debt zero company, bidding of which will be open from 25-27 September 2023, the company said during the launch. “Gross debt as of 31st March 2023 was ₹4,200 crore. Net debt was ₹2,200 crore as we have a cash balance of ₹2,000 crore. And we will be using ₹900 crore (from IPO) for repayment. So, the balance remaining, general corporate purpose and all this put together will be net debt free post IPO,” he added.
The company says capex has been allocated to specific projects like ₹865 crore for expansion of LPG terminal project at Jaigarh Port, ₹103 crore for purchase and installation of a dredger, and ₹150 crore for proposed expansion at Mangalore Container Terminal besides general corporate purposes, he said.
“So, around two years’ time to spend this money. Capex of ₹1,200 crore is towards that, not for any acquisition,” he said.
The company plans to further expand its operations through brownfield and greenfield projects.
The new capacity building is aimed at strengthening its presence in handling container and liquid cargo with a focus on growing its third-party customer base.
The Sajjan Jindal and family trust holds the majority stake of 96.5% in the company and they are not looking to sell the promoter shares. The entire IPO will be a fresh issue. Based on the current valuation, the company is currently looking at an 11.2% dilution. According to the Securities and Exchange Board of India (Sebi), newly listed firms are given three years to meet the requirement of 25% public float.
It reported a profit after tax (PAT) of ₹750 crore at the end of FY23 with a topline of ₹3,195 crore, while it reported earnings before interest, taxes, depreciation, and amortization (Ebitda) margin of 53%. JM Financial Ltd, Axis Capital Ltd, Credit Suisse Securities (India) Private Ltd, DAM Capital Advisors Ltd, HSBC Securities and Capital Markets (India) Private Ltd, ICICI Securities Ltd, Kotak Mahindra Capital Co. Ltd, and SBI Capital Markets Ltd are the book running lead managers and KFin Technologies Ltd is the registrar to the issue. The equity shares are proposed to be listed on BSE and NSE.
