Chennai-based infrastructure construction and project management company GVR Infra Projects Ltd has filed its draft herring prospectus (DRHP) with the capital markets regulator Securities and Exchange Board of India (SEBI) for its initial public offer (IPO).
The firm, which is backed by IDFC Alternatives, said it intends to raise up to Rs 150 crore in a pre-IPO funding round.
The opening of the primary market last year and the expectations of a boost to the infrastructure sector to drive growth in the slowing economy have made infrastructure a key space to watch out for.
Infrastructure PE funds that had been holding on to their purse strings and had seen their dry powder or the committed corpus yet to be deployed soar to $1 billion in the first three months of this year, started investing furiously in the second quarter ended June 30. In the process infra funds became the top investor among SEBI's alternative investment fund (AIF) category.
Among others, Dilip Buildcon is waiting to float its IPO, while Sadbhav Infrastructure went public last month.
Here's a snapshot of the GVR issue and the firm:
* The IPO comprises a fresh issue of shares to raise up to Rs 400 crore (about $61 million) and an offer for sale of up to 4.3 million equity shares by IDFC Alternatives.
* Bankers: Edelweiss, Ambit, SBI Capital and IDFC Securities.
Objects of the issue
Of the total money being raised from fresh issue, the company plans to use Rs 225 crore to fund working capital requirements, Rs 100 crore to pay back short-term borrowings and remaining for general corporate purpose.
* Incorporated in 2001, GVR Infra provides EPC (engineering, procurement and construction) services in the road, irrigation, railways, bridges and civil construction sectors.
* It carries out EPC services for government departments and authorities such as state highway authorities, state public works department, the defence ministry and private entities.
* Under construction contract business, as of July 31, 2015, it had completed 135 EPC projects including 118 projects in the transportation sector, five projects in the irrigation sector and 12 in the civil construction sector.
* As of July 31, 2015, it has completed EPC services for approximately 3,028 lane kms of roads, 3,727.82 metres of bridges, 29.10 kms of irrigation canals, 29.50 kms of railway track and 81,353.75 sq ft of building area across India and is providing EPC services for approximately 3,879.38 lane kms of roads, 5,566.63 metres of bridges, 796.89 kms of irrigation canals, 142.38 kms of railway track and 164,517.28 sq ft of building area.
* It also provides operation and maintenance and advisory and project management services to some SPVs for BOT business.
* Under the BOT business, it has seven operating BOT road projects and four under-construction projects, all of which have achieved financial closure and three of which are in advanced stages of construction.
* Four of 11 BOT projects are annuity projects, five projects are toll projects and two are a combination of toll and annuity projects. Besides, seven of 11 projects are operational with an average residual life of approximately 14 years.
* As of July 31, 2015, the company's operational projects cover 704.4 lane kms of road and 600 metres of bridges while ongoing BOT projects comprise development of 973.02 lane kms.
* As of July 31, 2015, it had 1,396 employees.
* Garikapati Venkateswara Rao, Kondepati Ganga Prasad and Garikapati Pavan Kumar are promoters of the firm.
For the financial year ended March 31, 2015, the company's consolidated revenue was Rs 1,553.57 crore against Rs 1,412.57 crore and Rs 1,468.9 crore, respectively, in the previous two fiscals. In the same period, its net profit halved and it closed last year with Rs 31.41 crore.
IDFC’s private equity arm had invested Rs 150 crore for 21.43 per cent stake in the company in July 2011. It is selling under half of this in the offer for sale.