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Texmaco Rail and Engineering raises under $50M through oversubscribed QIP

Kolkata-based Adventz Group firm Texmaco Rail and Engineering Ltd has raised Rs 300 crore (approximately $48.39 million) through qualified institutional placement, according to a statement.

The QIP was made at Rs 107 per equity share, which was at a premium to the floor price as per SEBI guidelines, the statement said.

The issue was oversubscribed 2.8x the maximum issue size and received bids of around Rs 850 crore (nearly $137 million) from 17 investors with a fair mix of existing and new investors.

“The overwhelming response to our QIP endorses investors’ confidence in the improved business prospects for the railway sector. The initiatives taken by the newly elected central government promises bright prospects for the rail-related businesses in India, and Texmaco is best positioned for it to capitalise,” Ramesh Maheshwari, executive vice chairman, Texmaco Rail said.

The issue drew strong interest from leading mutual funds, life insurance companies & FIIs including HDFC Asset, Reliance Capital, Sundaram, Jupiter, Fidelity, Goldman Sachs, etc.

“We believe that the railway infrastructure space is a sector which is poised to grow significantly, given the new government's thrust on PPP route and recent initiatives like FDI in railways. Texmaco, with its in house design capabilities and state of the art infrastructure, is at the right spot to seize the opportunities,” said Ajay Saraf, executive director, ICICI Securities.

ICICI Securities acted as the sole book running lead manager to the QIP.

Texmaco (formerly Texmaco Machines Ltd) is a freight car manufacturing company. The company, which is engaged in the heavy engineering and steel foundry business, provides rail freight cars and diversified engineering services. The firm has five manufacturing units.

(Edited by Joby Puthuparampil Johnson)

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