JSW Infrastructure Limited, a prominent JSW group company that offers maritime-related services including cargo handling, storage solutions, and logistics services, made its debut today at an impressive premium in the Indian stock market.
The stock debuted at Rs 143 per share, which is 20% higher than the issue price on the BSE. On the NSE, the stock opened at Rs 143 per share, marking a 20% increase from its initial public offering price of Rs 119 per share.
As of the time of writing, the stock is trading at Rs 152.25 on the BSE, with intraday highs and lows of Rs 152.70 and Rs 141.75, respectively. The current market capitalization of the company stands at Rs 31,752 crore.
The company plans to use the net proceeds generated from the issue for several specific purposes. First, they intend to prepay or partially repay certain outstanding borrowings by investing in their wholly owned subsidiaries, JSW Dharamtar Port Private Limited and JSW Jaigarh Port Limited.
Additionally, the funds will be allocated to finance capital expenditure requirements for the proposed expansion and upgrading projects at Jaigarh Port, which include expanding the LPG terminal, establishing an electric sub-station, and acquiring and installing a dredger, all of which will be managed through investments in JSW Jaigarh Port Limited.
Furthermore, they will support capital expenditure needs for the proposed expansion of Mangalore Container Terminal, achieved through investments in their wholly owned subsidiary, JSW Mangalore Container Terminal Private Limited. Lastly, the company will utilize the proceeds for general corporate purposes.
JSW Infrastructure Limited is a leading player in maritime services, offering cargo handling, storage, and logistics solutions. They manage ports and terminals under long-term concessions, and they’re a part of the JSW Group. In 2022, they became India’s second-largest commercial port operator.
Their portfolio covers a wide range of cargo types, including coal, iron ore, sugar, steel, and more. Notably, their ports enjoy extended concession periods of 30 to 50 years.
JSW Infrastructure has a strong national presence with ports in Maharashtra and terminals in key industrial regions on both the east and west coasts of India. They also operate two terminals in the UAE. As of June 2023, they manage nine Port Concessions in India with a cargo handling capacity of 158.43 MTPA. This capacity has grown at an impressive 15.27% CAGR from March 2021 to March 2023.
On September 27, 2023, the final day of the IPO window, the IPO witnessed an overwhelming response with a subscription rate of 39.36 times. The public issue received an impressive response, with the retail category being subscribed 10.87 times, the QIB category achieving a subscription rate of 60.12 times, and the NII category reaching a subscription rate of 16.83 times.
The company attracted Rs 1260 crore from various anchor investors by allocating 10.58 crore equity shares at Rs 119 per share. The complete lock-in period for these anchor investors ends on February 12, 2024.
The IPO price range was set between Rs 113 and Rs 119, with a face value of Rs 2 per share and a lot size of 126 shares. The total size of the company’s IPO was Rs 2800 crore, and the final share issue price was fixed at Rs 119 each.
|Particulars||FY21 (Rs Cr)||FY22 (Rs Cr)||FY23 (Rs Cr)|
|Net Profit / (Loss)||284.62||330.44||749.51|
The crucial question that arises in everyone’s mind is whether to hold onto the shares or book profits. Considering the current market conditions the broader indices have slipped from their all-time high levels, investors who applied for listing gains have already earned 20% on the listing day alone and can choose to book the profit it has generated.
On the other hand, looking at the strong financials, investors with a higher risk appetite may opt to hold the shares for the medium to long term, which could prove to be beneficial.
Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.