Shapoorji Pallonji-backed Afcons Infrastructure files for Rs 7,000 crore IPO

Afcons Infrastructure Ltd (AIL), the renowned infrastructure engineering and construction arm of the esteemed Shapoorji Pallonji Group has filed draft papers with the Securities and Exchange Board of India (Sebi) to raise a substantial Rs 7,000 crore through an initial public offering (IPO).

The IPO comprises a combination of fresh shares worth Rs 1,250 crore and an offer for sale (OFS) of up to Rs 5,750 crore by promoter Goswami Infratech Private Limited. Additionally, the offering includes a provision for subscriptions by eligible employees, as disclosed in the draft red herring prospectus (DRHP) submitted on Thursday.

Presently, the promoter and promoter group entities collectively hold an impressive 99.48 per cent stake in Maharashtra-based Afcons Infrastructure, affirming the group's steadfast commitment to the company's growth and development.

In line with its IPO plans, Afcons Infrastructure is contemplating a pre-IPO placement round to raise up to Rs 250 crore. Should this placement be successfully executed, the size of the fresh issue will be adjusted accordingly.

Established in 1865, the Shapoorji Pallonji Group (SP Group) boasts a rich legacy of diversified operations across engineering & construction, infrastructure, real estate, water, energy, and financial services sectors globally. Renowned for building iconic landmarks and spearheading innovation in various industries, SP Group companies have earned a reputation for excellence and reliability.

Afcons Infrastructure operates across five major infrastructure business verticals, including marine and industrial, surface transport, urban infrastructure, hydro and underground, and oil and gas. Over the past decade, the company has completed an impressive portfolio of 76 projects across 15 countries, with a cumulative contract value exceeding Rs 52,220 crore.

Comparing itself with listed industry peers such as Larsen & Toubro Ltd (L&T), KEC International Limited (KEC), Kalpataru Project International Ltd (KPIL), and Dilip Buildcon Ltd (DBL), Afcons Infrastructure has showcased robust growth metrics. The company's order book has witnessed a commendable Compound Annual Growth Rate (CAGR) of 7.6% from Rs 26,249 crore in FY21 to Rs 30,406 crore in FY23, further bolstering investor confidence.

In terms of financial performance, Afcons Infrastructure reported a 14.7 per cent increase in consolidated revenue from operations, reaching Rs 12,637.38 crore during FY23 compared to Rs 11,018.97 crore in the previous year. Additionally, the company's profit after tax surged by 15% to Rs 410.86 crore in FY23, reflecting its strong operational efficiency and profitability.

Leading financial institutions, including ICICI Securities, DAM Capital Advisors, Jefferies India, Nomura Financial Advisory and Securities, Nuwama Wealth Management, and SBI Capital Markets, have been appointed as the book-running lead managers to oversee the IPO process, underscoring the high level of confidence in Afcons Infrastructure's growth prospects and market positioning.

(With PTI inputs)