The company has signed binding definitive agreements with GIC for a total investment of up to Rs 4,400 crore, including funding of future construction costs
Share price of IRB Infrastructure Developers rose 11.5 percent in the early trade on August 7 after the announcement of investment by Singapore’s sovereign wealth fund in company's road operations.
The company in its press release said about investment by affiliates of GIC, Singapore’s sovereign wealth fund, in its road platform.
The company has signed binding definitive agreements with GIC for a total investment of up to Rs 4,400 crore, including the funding of future construction costs.
As part of the transaction, IRB will transfer nine of its BOT assets into a private infrastructure investment trust in which IRB will hold the controlling stake of 51 percent, it added.
IRB will have management control over these assets with GIC having standard/customary rights of a financial investor and corresponding board representation.
Meanwhile, the company's Q1 profit declined 17.4 percent to Rs 206.6 crore versus Rs 250 crore and revenue rose 15.3 percent to Rs 1,773 crore versus Rs 1,538 crore YoY.
CLSA has maintained buy rating on the stock but cut target to Rs 225 from Rs 250 per share.
According to CLSA, the GIC deal valuation is above company’s market cap, valuing other assets at negative value.
In Q1, the company os on track to ramp up construction post-financing all four new concessions. The stock offers deep value trading at 4x PE & 0.5x P/BV.At 0940 hours, IRB Infrastructure Developers was quoting at Rs 103.35, up Rs 8.00, or 8.39 percent on the BSE.Subscribe to Moneycontrol Pro and gain access to curated markets data, trading recommendations, equity analysis, investment ideas, insights from market gurus and much more. Get Moneycontrol PRO for 1 year at price of 3 months at 289. Use code FREEDOM.