CG Power & Industrial Solutions, which was planning to raise Rs 3,000 crore through a qualified institutional placement (QIP), saw bids worth around Rs 10,000 crore pour in with leading mutual funds, insurance companies and long-only foreign portfolio investors (FPIs) accounting for the largest chunk of bids, said a source familiar with the offer details.
Amongst mutual funds, Axis MF, Aditya Birla MF, WhiteOak Capital MF, and HDFC MF have put in significant sized bids with insurance majors like SBI Life Insurance and HDFC Life Insurance also participating in the QIP in a big way.
Among foreign investors, BlackRock is believed to have put in a large bid with some amount of bids coming from hedge funds as well.
“There are some hedge funds as well in the list of bidders but bulk of the allocation would be made to domestic and foreign long-only players. One can say that a significant majority would go to domestic institutional investors like mutual funds and insurance firms,” said the source on conditions of anonymity.
The QIP was done at a price of approximately Rs 660, which is nearly 3.25% lower than Monday's closing price. Further, the indicative issue price of Rs 660 is nearly three percent lower than the floor price of Rs 679.08 as ascertained by the formula prescribed by the Securities and Exchange Board of India (SEBI).
On Tuesday, shares of CG Power were marginally up, trading at Rs 683.65 at 3:05pm.
In terms of dilution, the QIP size comes to around 2.89% of the post-issue outstanding equity paid-up capital, assuming full subscription of the offering. The QIP opened post market hours on Monday and closed today by 9am.
DAM Capital Advisors, IIFL Capital and HSBC Securities are the merchant bankers managing the QIP.
The fund raising comes close on the heels of the engineering company securing an order for the supply and servicing of 765kV Transformer package 7TR-12 Bulk by the Power Grid Corporation of India Ltd.
The total value of supply of goods including services is around Rs 641 crore, becoming the first single largest order bagged by the company. The supply of the goods is expected to be completed in 18 to 36 months, as per a stock exchange statement issued by the company.
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