PNC Infratech IPO subscribed 14% at end of day 2

Agra-based infrastructure firm PNC Infratech Ltd (PNC), which specialises in construction of highways, bridges, flyovers and airport runways, has received tepid response from the investors with its initial public offer (IPO) subscribed just around 14 per cent at the end of the second day of the issue.

The public float received total bids for 1.23 million equity shares on the eve of the penultimate day of the issue against the total size of 9.5 million equity shares.

As per the data available with the stock exchanges, while qualified institutional buyers’ (QIBs) portion saw 21 per cent subscription, HNIs & corporates and retail investors bid for 23 per cent and 6 per cent of their portions, respectively, as of end of day 2.

The issue had a real slow start to begin with and saw only 1.2 per cent of the issue covered on the first day on May 8. Only a small quantum of shares reserved for employees saw close to full subscription as of day 2.

It had previously raised approximately Rs 146 crore (around $23 million) from a bunch of domestic and foreign investors who have come as anchor investors ahead of its IPO. The issue will close on Tuesday, May 12.

PNC Infratech had filed draft red herring prospectus with SEBI in September 2014. The public issue, which will raise up to Rs 486 crore, will also provide a partial exit to Jacob Ballas. The company had floated its issue with a price band of Rs 355-378 per share.

Mid-market PE investor Jacob Ballas is selling a little over one-fifth of its holding.

Of the fresh issue proceeds, the company would use Rs 150 crore to fund working capital requirements besides putting in Rs 35.2 crore to repay debt. In addition, it plans to use Rs 65 crore to invest in a subsidiary, PNCRHPL for part-financing the Raebareli-Jaunpur project besides Rs 103 crore as investment in capital equipment.

ICICI Securities and IDFC Securities are the bankers.

In 2009, PNC Infratech planned to raise Rs 175 crore through IPO but later withdrew its plan due to poor market conditions.

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