 "JSW Infrastructure files DRHP with Sebi, plans to raise Rs 2,800-cr via IPO")
JSW Infrastructure, the ports’ business arm of the JSW Group, has filed a draft red herring prospectus (DRHP) with the Securities and Exchange Board of India (Sebi) for a Rs 2,800-crore initial public offering (IPO). This makes it the third company of the group that aims to go public.
In its filing, JSW Infra said it will use the proceeds to retire debt and fund infrastructure expansion projects across the country. The company has an installed capacity of 153 million tonnes per annum (mtpa) at its terminals in various ports.
JSW Infrastructure is currently a concessionaire at nine ports across India, along with two port operations in the United Arab Emirates (UAE) with an installed capacity of 41 mtpa.
In FY23, major ports recorded a cargo growth of 10.4 per cent, overturning the earlier trend of losing cargo share to private ports at a rapid pace.
Over the next five fiscal years, growth in Indian ports is expected to be around 3-6 per cent, CRISIL Research has estimated.
“In fiscal 2024, the growth in port traffic is expected to moderate to 3-6 per cent,” the DRHP said, quoting a report by CRISIL.
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Climate change and the shift of major economies away from fossil fuels may pose downside risks to the company’s business, the prospectus said.
“However, due to the ongoing concerns around climate change, many countries, including India, are seeking to transition into low-carbon economies. So, the growth of coal traffic is expected to remain flattish in the next five fiscal years.”
The company is hopeful of leveraging the growth of the group’s other businesses to fuel its cargo unit.
“For example, our anchor customers are in the process of achieving expanded installed capacities at their facilities in India. JSW Steel is aiming to achieve up to 37 mtpa in fiscal 2025 from 27.7 mtpa in fiscal 2023. JSW Energy aims to achieve up to 10 Gw in fiscal 2025 from 4.8 Gw in fiscal 2023,” the company said in its DRHP.
The company proposes to develop a port at Jatadhar (Odisha) to cater to JSW Steel’s upcoming steel facility.
Jatadhar, along with Jaigarh Port, features in the company’s list of projects to be invested in through the proceeds of the IPO. This is along with payment of debt of Rs 880 crore pertaining to the two ports.