Massive volumes in Gujarat Pipavav Port counter on debut

The stock settles at Rs 54.05 on BSE

Gujarat Pipavav Port (GPPL) settled at Rs 54.05 on BSE, a premium of 17.5% over the initial public offer (IPO) price of Rs 46. The stock debuted at Rs 56.25, a 22.28% premium over the initial public offer (IPO) price. The stock hit a high of Rs 58.40 and a low of Rs 51.90.



A staggering 5.79 crore shares changed hands in the counter on BSE.

The IPO of (GPPL) had received strong investor response. The public issue closed on 26 August 2010, with almost 20 times subscription. The IPO got bids for 220.21 crore shares, compared with 11.04 crore shares on offer. The price band for the IPO was Rs 42-48 per share

The non-institutional investors category, which comprises of high networth individuals and corporate treasuries, was subscribed a staggering 85.7 times. The retail investors category was subscribed 9.15 times.

The qualified institutional buyers (QIBs) category was subscribed 13.20 times. QIBs put in bids for 74.76 crore shares, compared with 5.66 crore shares, which were on offer for this category of investors. Within the QIB segment, foreign institutional investors put in bids for 31.75 crore shares. Domestic financial institutions, other than mutual funds put in bids for 26.98 crore shares. Mutual funds put in bids for 14.02 crore shares.

GPPL had raised Rs 92 crore by roping in 20 anchor investors, a day before the opening of the IPO.

The GPPL public issue comprised a fresh issue of shares aggregating to Rs 500 crore and an offer for sale of up to 1.17 crore shares by the Infrastructure Fund of India and the India Infrastructure Fund.

The company proposes to use the proceeds of the IPO for prepayment of loans, investment in capital expenditure, capital equipment and general corporate purposes.

GPPL is the country's first private sector port providing facilities for handling both containers and bulk cargoes. It is promoted by APM Terminals, which is one of the largest container terminal operators in the world and is part of the Denmark-based AP Moeller Maersk Group.

The revenue stream of the company can be broadly divided into income from port services and rental income from premises which are sub-leased by the company. Port services include services for container cargo, dry bulk cargo and LPG cargo and value-added port services, including container freight services.

The principal component of the company's operating revenue is derived from container cargo and dry bulk cargo. Revenue from container cargo consists of container handling charges, berth services, marine services and storage. The revenue from bulk cargo consists of handling and storage of bulk cargo, marine services, berth hire charges, wharfage charges, stevedoring charges and port operation charges. The revenue from LPG cargo consists of marine services and related ancillary facilities, including providing hose pipe connections to the vessels.

GPPL clocked a revenue growth of 31% to Rs 219.12 crore for the ended December 2009 (FY 2009) and an operating profit growth of 246% to Rs 44.06 crore as OPM improved from 7.6% to 20.1%. However, strained by higher interest cost and depreciation, the company reported a net loss of Rs 117.67 crore for FY 2009, much higher than a net loss of Rs 67.60 crore for the year ended December 2008 (FY 2008).