Indian Railways Finance Corp. had a muted debut on the stock market as it listed at a discount over issue price even as investors had piled into the initial public offering of the borrowing arm of Railways.
The stock began trading at Rs 24.9 apiece, a 4% discount to its issue price of Rs 26, according to the data available on the exchanges. That compares with a 36.5% listing premium by Antony Waste Handling Cell—the first debutante for the new calendar year. Shares fell further to close 4.6% lower at Rs 24.8 apiece.
IRFC's maiden offer, which closed on Jan. 20, comprised a fresh equity issue of up to 118 crore equity shares and an offer-for-sale for up to 59.4 crore shares by the government.
The IPO was subscribed 3.5 times at the end of the final day of bidding. The demand was led by institutional investors, who saw the portion reserved for them subscribe 3.78 times compared to the shares on offer. Retail investor subscription for the issue stood at 3.66 times, while the non-institutional investor category was subscribed 2.66 times. The employee quota was subscribed 43.76 times.
Ahead of the issue, IRFC had raised Rs 1,389.86 crore by allocating shares to anchor investors, including HDF Equity Fund, Government of Singapore, Nippon India Tax Savers Fund, among others.
The company had said it plans to utilise the proceeds of the IPO to augment its equity capital base to meet the capital requirement, since it finances the acquisition of rolling stock assets, including powered and unpowered vehicles such as locomotives, coaches, wagons, trucks, flats, electric multiple units, containers, cranes, trollies.
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