Private equity firms-backed Gujarat Pipavav Port Ltd– that raised around Rs 500 crore through a fresh issue of shares last month– listed at Rs 56.10, 22% premium to the issue price and was trading at Rs 53 in early hours on debut.
At this price, the consortium of private equity investors that include IDFC Infrastructure Fund, Jacob Ballas, IL&FS Trust and Infrastructure Fund of India are sitting on 33% unrealised gains on their five-year-old investment.
While these PE investors who pitched in with investments around five years ago are sitting on profits, there are others who are still much behind break-even point for their older investments. These include certain entities and funds under UTI that had acquired shares around 10 years ago at an issue price of Rs 80 a piece.
Among others, New York Life International is also sitting with some unrealised losses as it initially invested Rs 48 crore at a price of Rs 80 per share and later put in an additional Rs 2 crore at a lower price of Rs 40 a piece.
At the latest traded price, the company has a market capitalisation of Rs 2,250 crore (~$480 million).
The issue that was subscribed 19 times led by high demand from non institutional bidders, was to partly fund construction of container yards and allied facilities at Pipavav Port, Phase 2 of capital dredging at the same port, purchase of certain specialised cranes besides repayment of sponsor support loan to the promoter firm APMT Mauritius.
Earlier promoted by Nikhil Gandhi led SKIL, the company is now led by Dutch firm APM Terminals an A P Moeler Maersk Group company. The company is the developer and operator of Port Pipavav, India’s first private sector port, which has multi-cargo and multi-user operations. It has the exclusive right to develop and operate Port Pipavav and related facilities until September 2028.
APM Terminals owned 54.81% stake pre IPO and as per the plans, Gujarat Pipavav will now issue fresh shares to its promoter at the issue price(Rs 46) as a preferential allotment to ensure that it continues to hold at least 46% stake in the firm. Post issue APM’s holding has shrunk to 43%. As per VCCircle estimates, promoters need to infuse a further Rs 107 crore to achieve its targeted holding.