Recently listed stock which is one of the leading infrastructure construction companies involved in the execution of large and complex projects jumps upto 11 percent from the day’s listing price upon receiving work orders worth Rs. 1,007 Crores and strong demand from investors.
Price Action
With a market capitalization of Rs. 17,516 Crores, the shares of Afcons Infrastructure Limited were trading at Rs. 476.25 per equity share and it made an intraday high of Rs. 479.25 per share after making a muted listing in the stock exchange in the day at Rs. 463.
What Happened
Afcons Infrastructure Limited has been declared as the lowest bidder (L1 Bidder) and received a new work order for the construction Package BH-05 of the Bhopal Metro Phase 1 project’s 12.915 km Blue Line (Line-2) which will connect Bhadbhada Chauraha – Ratnagiri Tiraha via 13 elevated stations for a consideration of Rs. 1,006.74 Crores.
The work order by Madhya Pradesh Metro Rail Corporation Ltd (MPMRCL) includes the construction of the entire Blue Line viaduct, 13 stations, and a ramp leading to Subhash Nagar Depot which will be shared with Orange Line (Karond Circle – AIIMS) for maintenance and stabling.
About the Company
Afcons Infrastructure Limited is the flagship infrastructure engineering and construction company of the Shapoorji Pallonji Group, a diversified Indian conglomerate, as per the latest ENR survey, Afcons is ranked in the Top 120 international Contractors globally, 10th in Marine & Ports and 12th in Bridges.
Afcons Infrastructure Limited is one of the leading infrastructure construction companies involved in the execution of large and complex projects both in India and overseas.
It focuses on large, complex, and high-value projects with a strong track record in efficient project management, execution, and on-time delivery of projects across verticals and geographies. As of Q2FY25 Afcons Infrastructure Limited has a strong orderbook of ~Rs. 40,000 Crores
IPO Details
Afcons Infrastructure Limited came out with its Initial Public Offering with a total issue size of Rs. 5,430 Crores, consisting of a fresh issue of Rs. 1,250 Crores and an offer for sale by its early investors/shareholders for Rs. 4,180 Crores.
The IPO was open from October 25-29th with the offer price band set at Rs. 440-463 per equity share consisting of a lot size of 32 shares, taking the total investment required to Rs. 14,816.
Post IPO
Upon successfully garnering public interest the IPO was fully subscribed 2.77 times, but shares of Afcons Infrastructure Limited made a weak debut at the Indian exchanges at a discount of 8 percent from its IPO price band due to the ongoing global tensions, political events, and many more.
Even though the company’s shares made a weak debut the shares recovered from the decline and jumped by upto 15 percent signaling strong demand, potential, and possible signs of brokerage and institutional, demand, outlook, and coverage.
Financials and Ratios
Its Revenue from operations grew by 4 percent YoY from Rs. 12,466 Crores in FY23 to Rs. 12,907 Crores in FY24, accompanied by profits of Rs. 409.67 Crores to Rs. 442.12 Crores.
In terms of Return ratios, it has reported a return on equity (ROE) of 14.5 percent, and a return on capital employed (ROCE) of 23.1 percent. It has reported a debt-to-equity ratio of 0.94.
Written by: Bharath K.S
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