Mon Oct 28 11:18:11 UTC 2024: ## Afcons Infrastructure IPO Sees Muted Response on Day Two
**Mumbai, October 28:** Afcons Infrastructure’s initial public offering (IPO) received a lukewarm response from investors on its second day of bidding, raising concerns about the company’s valuation despite its strong track record.
The IPO, which opened on Friday, October 25, saw only 25% of the offered shares subscribed by Monday afternoon, despite a price band of Rs 440-463 per share. While the retail investor allocation was 32% subscribed, the Qualified Institutional Bidders (QIBs) quota witnessed a mere 3% subscription.
Afcons Infrastructure, a leading infrastructure engineering and construction company belonging to the Shapoorji Pallonji group, is aiming to raise Rs 5,430 crore through the IPO, including a fresh issue of Rs 1,250 crore and an offer-for-sale (OFS) of up to Rs 4,180 crore.
The muted response comes amidst a volatile market sentiment and a decline in the grey market premium (GMP) for Afcons Infrastructure, which has fallen from Rs 75 earlier to Rs 25-30, suggesting a listing pop of merely 5-6%.
However, several brokerages remain positive on the long-term prospects of Afcons, citing its sound financial record, robust order book, and experienced management. They recommend subscribing to the IPO, despite concerns about its fully priced valuations and capital-intensive business model.
Afcons Infrastructure has already raised Rs 1,621.5 crore from anchor investors at Rs 463 per share.
With a diverse portfolio and a proven track record of completing projects on time, Afcons is strategically positioned to benefit from the government’s infrastructure development initiatives, including increased budgetary allocations and rapid urbanization.
The IPO is expected to conclude on Tuesday, October 29. ICICI Securities, DAM Capital Advisors, Jefferies India, Nuvama Wealth Management, Nomura Financial Advisory and Securities (India), and SBI Capital Markets are the book running lead managers for the issue.
First Piper 