Ahmedabad-based construction firm PSP Projects Ltd is seeking a valuation of close to Rs 755 crore (around $117 million) through its initial public offering (IPO) that opens next week.
PSP Projects, which offers construction and allied services across industrial and residential projects, has fixed the price band for its IPO at Rs 205-210 per share, the company said.
This would help the firm raise Rs 211.65 crore at the upper end of the price band for a 28% stake dilution from its maiden public issue on a post-offer basis.
The IPO comprises a fresh issue of 7.2 million shares and a secondary market sale of 2.88 million shares that would result in a part exit for the company’s founders, according to its draft red herring prospectus (DRHP).
PSP Projects’ public offering will open 17 May and close two days later. The company will offer shares to institutional investors through an anchor allotment on May 16.
PSP Projects will join several infrastructure and construction firms that are either planning to for public issues or have completed IPOs to list on bourses.
Delhi-headquartered GR Infraprojects Ltd is planning to go public with an estimated Rs 500 crore IPO.
Other infrastructure firms that went public in the past 18 months include Shankara Building Projects Ltd, Sadbhav Infrastructure Project Ltd, PNC Infratech Ltd, MEP Infrastructure Developers Ltd and Dilip Buildcon Pvt. Ltd.
The IPO by PSP Projects will be the eighth public issue to hit the market this calendar year. Companies that went public so far in 2017 include stock-exchange operator BSE Ltd , Avenue Supermarts Ltd which operates hypermarket chain operator D-Mart and FM radio operator Music Broadcast Ltd, among others.
The company hopes to benefit from the rise in stock markets this year. Last week, benchmark equity indices surged to record highs, reflecting the momentum in global markets. Most companies that have floated an IPO this year—including stock-exchange operator BSE, Avenue Supermarts and education-focused publishing house S Chand & Co—have received strong investor response to their share sales.
PSP Projects had filed draft prospectus for an initial share sale on 29 December 2016. It received The Securities and Exchange Board of India (SEBI)’s clearance on 24 March.
Excluding the IPO of Housing and Urban Development Company (Hudco), six companies have raised nearly Rs 5,000 crore so far this calendar year, extending the good run for IPOs.
In 2016, fundraising by companies through initial share sales rose to a six-year high of Rs 26,500 crore, data from SEBI showed.
The IPO market in India picked up pace after four years of slow activity in mid-2014 when the BJP-led government took over. In 2015, 21 companies had raised about Rs 14,000 crore, as per stock exchange data.
For further details on PSP Projects’ IPO, click here.
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