Gammon announces IPO with market low on sentiments

Mumbai, Mar 3 (UNI) With the market senitiments at low ebb, Infrastructure major Gammon Infrastructure Projects Limited (GIPL), with high expectations, announced today its Initial Public Offer of raising Rs 310 crore on its higher end of the issue price band of Rs 167 to 200 per equity share, opening on March 10.

GIPL will raise 16.5 million shares of Rs 10 each for the cash prize to be determined on a 100 per cent book building basis with the IPO closing on March 13.

The Issue has been graded by Credit Analysis&Research Limited as CARE IPO Grade 4, indicating above average fundamentals.

The Issue will comprise of 11.45 per cent and net issue of 1.48 million equity to the public will be 10.30 percent of the post-Issue paid up equity share capital of the company.

The Issue proceeds will be utilised for 14 ongoing projects GIPL had undertaken on highway construction and power plant projects.

Part of the issue would also be to repay the loan it had raised from the parent company, Gammon India besides investment in strategic initiatives and acquisitions.

Asked about the timing of the issue, especially when the capital maket was reeling under severe pressures, Company Managing Director Parvez Umrigar expressed confidence that the company would emerge successful at the IPO in view of its track record.

A salient feature of the issue was both retail and High Networth Investors had an option to pay only Rs 50 per share on application.

Mr Umrigar said that GIPL was one of the pure play infrastructure companies in the country and four of the 14 projects were already in operational phase, with seven others in development segment, three others were in pre development phase.

Replying to questions, he said that the company had not gone in for any pre IPO placements in the last few months. However, the Parent company had bought 4.48 million shares from private equity holder AMIF Limtied at Rs 151.76 per share. The lockin period of the placement was one year after the allotment of the IPO.

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