The initial public offering (IPO) of Indian Railway Finance Corporation (IRFC) worth about Rs 4,600 crore will hit the market on January 18, Department of Investment and Public Asset Management (DIPAM) Secretary Tuhin Kanta Pandey said on Wednesday.
"IRFC coming up for listing with a Rs 4600 cr+ issue in a price band of Rs 25-26 per share. Anchor book on Jan 15 and the main book from Jan 18-20," he tweeted.
The book running lead managers to the issue are DAM Capital Advisors, HSBC Securities and Capital Markets, ICICI Securities and SBI Capital Markets.
This will be the first IPO by a railway non-banking financial company (NBFC).
The NBFC would utilise the proceeds of the IPO for augmenting equity capital base to meet future capital requirements and general corporate purposes.
Earlier in January, IRFC had filed draft papers for IPO, which comprised a fresh issue of 93.8 crore equity shares and an offer for sale of 46.9 crore equity shares by the Government of India.
What is the price band of the IPO?
The IPO worth Rs 4,600 crore will be issued in a price band of Rs 25-26 per share. The face value of the share is Rs 10 each.
What is the issue size of the IPO?
The issue is of up to 178.20 crore shares, comprising a fresh issue of up to 118.80 crore shares and offer for sale of up to 59.40 crore shares by the government, according to the draft prospectus.
Who can bid and how much can one bid?
One can bid a minimum of 575 equity shares and in multiples thereafter.
50% of the net issue is reserved for Qualified Institutional Buyers (QIB).
The company has reserved about 35% of the issue for retail investors and 15% of the issue is reserved for the Non-Institutional category.
The company's principal business is to borrow funds from the financial markets to finance acquisition/ creation of assets which are then leased out to the Indian Railways.
IRFC, set up in 1986, is a dedicated financing arm of the Indian Railways for mobilising funds from domestic as well as overseas markets. Its primary objective of IRFC is to meet the predominant portion of 'extra budgetary resources' requirement of the Indian Railways through market borrowings at the most competitive rates and terms.
The Union Cabinet had in April 2017 approved listing of five railway companies. Four of them -- IRCON International Ltd, RITES Ltd, Rail Vikas Nigam Ltd and Indian Railway Catering and Tourism Corp -- have already been listed.
(With inputs from PTI)