The Securities and Exchange Board of India has approved the proposed initial public offerings (IPOs) of Chennai-based infrastructure construction company GVR Infra Projects Ltd and Mahanagar Gas Ltd, a Mumbai-focused city gas distribution company.
While GVR Infra Projects had filed its draft red herring prospectus (DRHP) with the capital markets regulator in October, Mahanagar Gas submitted its papers for the public issue in November last year.
GVR Infra Projects
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 shares by investor IDFC Alternatives. The firm also intends to raise up to Rs 150 crore in a pre-IPO funding round.
Incorporated in 2001, GVR Infra provides engineering, procurement and construction services in the road, irrigation, railways, bridges and civil construction sectors. It also carries out EPC services for government departments, state highway authorities, state public works departments, the defence ministry and private entities.
Under the construction contract business, it had completed 135 EPC projects as of July 31, 2015. This included 118 projects in the transportation sector, five projects in irrigation and 12 in the civil construction sector.
IDFC’s private equity arm had invested Rs 150 crore for a 21.43 per cent stake in the company in July 2011. It is selling under half of this in the offer for sale.
The company is owned by GAIL (India) Ltd and BG Asia Pacific Holdings Pte Ltd, an arm of the UK-based BG Group. The two partners will be selling 12.35 million shares each, it said in the DRHP.
GAIL and BG Asia each hold a 49.75 per cent stake while the Maharashtra government has a tiny 0.49 stake in the firm.
Mahanagar Gas distributes compressed natural gas for use in motor vehicles and piped natural gas for domestic household use as well as for commercial and industrial use.
In terms of revenue and profit, Mahanagar Gas is the third-biggest city gas distribution company in India after Ahmedabad-based Gujarat Gas Ltd and New Delhi-based Indraprastha Gas Ltd.