Standard Chartered Private Equity (SCPE) and Sabre Abraaj-backed construction firm Man Infra is looking to raise over Rs 120 crore through its public offering.
The company has filed its draft red herring prospectus with the Securities and Exchange Board of India. The issue only comprises fresh issue of shares and no sale by any existing investors. SCPE had invested in the firm early this year through two separate funds.
The issues comprise sale of 5.6 million shares of which net issue to public would be around Rs 5.4 million. The pricing is yet to be disclosed but it likely to be over and above Rs 215 per share.
Both Sabre Abraaj and SCPE had invested partly through fresh issue of shares and partly through sale of shares by promoters. Sabre Abraaj’s SA 1 Holding Infrastructure had invested Rs 83 crore in August 2008 and holds 9.23% currently. SCPE, through two funds, is estimated to have put in around Rs 60 crore to pick 6.91% stake in the firm.
The average price of acquisition for both the financial investors is pegged around Rs 200-205. So the management could be looking to give an upside of around 5-10% in the issue price. This is not significant given the sharp movement in stock valuations across sectors in India. In fact, the BSE’s benchmark Sensex has doubled in the last six months.
The promoters of Man Infra (Shah family led by Parag Shah) will own around 63% stake in the firm post IPO as against 71% currently.
For the year ended March 2009, Man Infra had consolidated revenues of Rs 594.2 crore against Rs 236 crore the previous year. Net profit had more than doubled to Rs 82 crore from Rs 32 crore in 2007-08. But for the quarter ended June 2009, revenues had shrunk 28% to Rs 114 crore compared to same period last year and profits or the quarter was flat at Rs 20 crore. As of June 2009, more than two thirds of the outstanding order book of the firm of Rs 1,086 crore was in residential projects (half of which in turn was for slum redevelopment).