JSW Infrastructure IPO subscribed 2.13 times, retail quota booked 4.52 times on Day 2

JSW Infrastructure which provides maritime-related services, including cargo handling, storage solutions, logistics services and other value-added services to customers is aiming for Rs 2,800 crore through its public issue at the upper price band.

The offer is entirely a fresh issue by the company, hence the entire issue proceeds will be used for the company.

Also read: JSW Infrastructure IPO: 10 things to know before you buy the issue

The price band for the public issue, which closes on September 27, is set at Rs 113-119 per share.

The anchor book, which opened for a day on September 22, was also fully booked as the port-related infrastructure company successfully raised Rs 1,260 crore from 65 anchor investors including marquee names like Morgan Stanley, Fullerton, HSBC, Government of Singapore, The Master Trust Bank of Japan, Monetary Authority of Singapore, Goldman Sachs, Sunil Singhania-owned Abakkus, LIC Mutual Fund, SBI Mutual Fund, ICICI Prudential Mutual Fund, and HDFC Mutual Fund.

The company will cut down its debt by Rs 880 crore through net fresh issue proceeds, while Rs 1,029.04 crore will be spent for expansion or upgrade works at Jaigarh Port, owned by subsidiary JSW Jaigarh Port.

Further, the Rs 151.05 crore will be used for its Mangalore Container Terminal (Mangalore container project) owned by subsidiary JSW Mangalore Container Terminal. And the remaining amount will be kept for general corporate purposes.

Also read: Updater Services IPO: 10 things to know before subscribing to Rs 640 crore issue

Back in 2010, the JSW Group had listed its energy business separately.

This issue is available at a P/EPS of 28.88x which appears reasonably priced as the company’s revenue visibility is strong for the future with steady margins, said Canara Bank Securities.

JSW Infra is the second largest commercial port operator in India, handling 92.8 million MT in FY23 (43 percent CAGR over FY21-23). 63 percent of volumes are derived from JSW Group customers while the balance 37 percent is from 3rd party customers which it plans to further increase to achieve a balanced customer base.

Also read: JSW Infrastructure IPO: Financials, shareholding, comparison with Adani Ports in 5 charts

Motilal Oswal also likes JSW Infra given its dominant position among the port operators in India, along with its broad cargo profile and diversified geographical presence. It believes the firm could benefit from the government's focus on port development, limited competition and strong parentage. Hence, it recommended subscribing to the issue.

JSW Infrastructure, the fastest growing port-related infrastructure company in terms of growth in installed cargo handling capacity and cargo volumes handled during FY21-FY23, will finalise the basis of allotment of IPO shares by October 3, and list its shares on the bourses on October 6, as per the IPO schedule.

Its IPO shares traded at around 12-15 percent premium over the upper price band, in the grey market, analysts said on anonymity. The grey market is an unofficial platform wherein IPO shares can be bought and sold till the listing.

Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.