The initial public offering (IPO) of construction firm PSP Projects Ltd made a tepid start on the first day on Wednesday as it was subscribed only 11%.
The public offering of 5.54 million shares – excluding the anchor investors’ portion – received bids for 6.12 lakh shares, stock-exchange data showed.
Retail investors led the bidding; the quota of shares reserved for them was covered nearly 40%. The portion set aside for non-institutional investors, such as corporate houses and wealthy individuals, was covered 15%. Institutional buyers didn’t bid.
Ahmedabad-based PSP is looking to raise as much as Rs 211.65 crore from the public issue. Of this, it mopped up Rs 95.26 crore from a bunch of anchor investors.
PSP allotted 4.53 million shares to nine institutional investors at the upper end of the price band of Rs 205-210 apiece. The company, which offers construction and allied services across industrial and residential projects, is seeking a valuation of $117 million.
PSP, whose offer will close on 19 May, 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 IPO size of Rs 500 crore.
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 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, FM radio operator Music Broadcast Ltd.
PSP Projects hopes to benefit from the rise in stock markets this year. Benchmark equity indices touched new highs on Wednesday. For more details on PSP Projects’ IPO, click here.