Sadbhav Infra Project's shares gain on debut

Company raised about Rs 425 crore from its IPO

Sadbhav Infrastructure Project shares closed at Rs 106 apiece during its stock market debut on Wednesday, compared to its issue price of Rs 103. The shares rose as much as nine per cent to Rs 112.45, but failed to sustain the gains as investors booked profits.

The company, which generates road toll collections, had raised Rs 425 crore from its Initial Public Offering (IPO), which closed earlier this month. The issue was subscribed over two times. Sadbhav Infrastructure Project, a subsidiary of listed firm Sadbhav Engineering, plans to use the IPO proceeds to repay loans of around Rs 260 crore and about Rs 80 crore as equity investment into its arm.

Shares of Sadbhav Engineering ended at Rs 290 apiece on Wednesday, up nearly a per cent from the previous close, on the NSE. Analysts said the IPO would help the company reduce debt, which is a positive but at current market price, the valuations are fairly priced. Six of the company’s existing 10 projects are fully operational, one partially operational, and three are in various stages of development (two expected to start in six to eight months).

The company boasts of diverse portfolio of toll roads, in seven states including Haryana, Rajasthan, Madhya Pradesh, Gujarat, Maharashtra, Karnataka, and Telangana.

Despite the volatility in the market over the past one month, some recently-listed companies include Navkar Corporation have seen listing gains, albeit marginal. Shares of Prabhat Dairy will get listed on Monday.