PNC Infratech IPO subscribed 14% on day 2

The initial public offer (IPO) of infrastructure development and management company PNC Infratech was subscribed 14 per cent on the second day of the offer.

The Rs 478-crore IPO received bids for 12,68,680 shares against the total issue size of 90,60,197, data available with NSE till 5 pm showed.

The portion reserved for qualified institutional buyers (QIBs) was subscribed 21 per cent while non-institutional investors received a subscription of 23 per cent. The retail investor category saw 0.06 times subscription.

The price band has been fixed at Rs 355-Rs 378.

The issue will close on May 12.

Post-issue, the shareholding of the promoter and promoter group in the company will fall to 56.1 per cent from the current holding of 72.3 per cent.

The company has already finalised the allocation of 3,861,511 equity shares to anchor investors at the upper price band of Rs 378 aggregating to around Rs 146 crore. The anchor investors include Goldman Sachs India, HDFC Trustee Co., Birla Sun Life Trustee Co., DSP Blackrock India, Reliance Capital Trustee Co., Reliance Mutual Fund, L&T Mutual Fund, Sundaram Mutual Fund and Kotak Mutual Fund.

The book running lead managers to the offer are ICICI Securities Limited and IDFC Securities Limited.

The company plans to use the net proceeds to fund its working capital requirements (Rs 150 crore), invest in its subsidiary (Rs 65 crore), invest in capital equipment (Rs 85 crore), repay certain debts (Rs 35 crore) and for general corporate purposes.

The company has executed 42 major infrastructure projects on an EPC basis. For the year ended March 2015, the company's order book was at Rs 7,849.7 crore against Rs 6,085.78 crore last year.

In terms of financials, revenues have grown at 11 per cent annually during 2009-10 and 2013-14 to Rs 1,145.6 crore. The operating margin has remained at the level of 11-12 per cent. It has also received a credit rating of CARE A for long term and CARE A1 for short-term.