Ceigall India Attracts Rs 375 Crore from Anchor Investors Before IPO

Ceigall India Ltd, an infrastructure company, announced on Wednesday that it has raised Rs 375 crore from anchor investors. This announcement comes a day before the company's initial public offering (IPO) opens for public subscription.

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The IPO, priced between Rs 380 and Rs 401 per share, will be available for subscription from August 1 to August 5. The Ludhiana-based company's IPO includes a fresh issue of Rs 684.25 crore and an Offer-For-Sale (OFS) of up to 1.42 crore equity shares worth Rs 568.41 crore at the upper price band, making the total issue size Rs 1,252.66 crore.

Anchor Investors and Allocation

According to a circular on BSE's website, ICICI Prudential Mutual Fund, HDFC Mutual Fund, Axis Mutual Fund, Bandhan Mutual Fund, ICICI Prudential Life Insurance Company Ltd, Bajaj Allianz Life Insurance Company Ltd, and Max Life Insurance Ltd are among the anchor investors. Additionally, Nomura, Integrated Core Strategies Asia PTE Ltd, Societe Generale, Morgan Stanley Asia Singapore PTE, and Citigroup Global Markets Mauritius have also been allocated shares in this round.

The company has allotted 93.56 lakh shares to 29 funds at Rs 401 each, totalling Rs 375.2 crore. Half of the issue size is reserved for qualified institutional buyers, 35 per cent for retail investors, and the remaining 15 per cent for non-institutional investors.

Company Background and Financials

Founded in 2002, Ceigall India specialises in infrastructure construction projects such as elevated roads, flyovers, bridges, railway over bridges, tunnels, highways, expressways, and runways. As of June 2024, the company's order book stood at Rs 9,470 crore.

The company's revenue from operations increased by 46.5 per cent to Rs 3,029.35 crore in fiscal year 2024 from Rs 2,068.17 crore in fiscal year 2023. Profit after tax also grew to Rs 304.3 crore from Rs 167.27 crore during the same period.

Use of Proceeds

The proceeds from the fresh issue will be utilised for purchasing equipment and repaying debt. A portion will also be allocated for general corporate purposes.

Promoters and promoter group entities—Ramneek Sehgal, Ramneek Sehgal and Sons HUF, Avneet Luthra, Mohinder Pal Singh Sehgal, Parmjit Sehgal, Simran Sehgal—and individual shareholder Kanwaldeep Singh Luthra are divesting their stakes in this public issue.

Subscription Details

Investors can bid for a minimum of 37 equity shares and in multiples thereof. ICICI Securities Ltd., IIFL Securities Ltd., and JM Financial Ltd. are the book-running lead managers for the IPO. The equity shares are proposed to be listed on both BSE and NSE.

The company's clientele includes public sector entities like Indian Railway Construction International Ltd., Military Engineer Services, and Bihar State Road Development Corporation Ltd.

This strategic move aims to strengthen Ceigall India's financial position while expanding its operational capabilities in the infrastructure sector.