PE-backed GR Infraprojects files for India IPO

The offering will comprise an undisclosed number of newly issued shares for up to INR5 billion ($75 million), according to the prospectus, along with up to 11 million shares from existing shareholders including 8.7 million shares held by MOPE out of its total holding of 9.8 million. Pricing for the shares has not been announced. The offer for sale represents about 11% of GR's existing share capital.

From the fresh issue, up to INR1.8 billion will be invested in three of GR's subsidiaries: Porbandar Dwarka Expressway, a highway in Gujarat; Varanasi Sangam Expressway, in Uttar Pradesh; and GR Phagwara Expressway, in Punjab. Another INR1.3 billion will be used to repay debt, while INR1 billion will go toward purchasing heavy equipment.

GR was founded in 1995 and operates in three main categories: engineering, procurement and construction (EPC) road-building services; operation of roads and highways on a build, operate and transfer (BOT) basis; and manufacturing of asphalt, road signs and other equipment. It has executed road projects in 14 Indian states and had an order book of INR98.9 billion as of January 2018.

MOPE invested in the company in 2011 alongside IDFC, with the two firms committing INR500 million and INR300 million respectively. IDFC has since exited its stake but has maintained its relationship with GR, buying two road projects from the company in 2016.

India's government spent INR5.8 trillion on road and highway construction between 2013 and 2017, and is projected to spend another INR11 trillion from 2018 to 2022. GR believes that as an experienced infrastructure developer it is well-placed to benefit from this increase in spending.

For the year ended March 2017, GR reported INR32 billion in revenue, up from INR19 billion the year before. Over the same period net profit grew from INR1.4 billion to INR5.4 billion.

This is the third IPO by a MOPE-backed company in the last 12 months. It follows offerings by Dixon Technologies and India Energy Exchange. MOPE exited most of its holding in Dixon's IPO but did not sell any shares in IEX's offering.

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• Topics
• South Asia
• Infrastructure
• IPO
• India
• Motilal Oswal Private Equity
• Exit