L&T Infotech and HPL Electric & Power have got SEBI approvals to bring their initial public offerings (IPO). These upcoming IPOs will raise nearly INR1,800 crore (INR18 billion) on a combined basis. SEBI issued its observations to both IPO applications on 20 May, indicating its blessings for the public issues. With the latest approvals, India’s IPO pipeline has increased to 24.
L&T Infotech – the IT services arm of engineering giant Larsen and Toubro (L&T) – trimmed its IPO size from INR2,000 crore to INR1,300-1,400 crore. The company was already added in the IPO pipeline as it received regulatory approvals last year but filed a revised application to reflect the changes in the IPO structure. The issue will comprise of an offer for sale (OFS) of up to 1.75 crore shares to be offered by its parent which currently owns 100% of L&T Infotech. Since the company had already received approvals and the fresh changes were just related to issue structure, SEBI took all of 38 days, including weekends, to clear L&T Infotech’s application this time. This is the fastest turnaround by SEBI in at least three years.
The other IPO application cleared by SEBI is of HPL Electric & Power which filed draft prospectus in February. HPL Electric plans to raise INR450 crore by issuing new shares which will be listed on the BSE and NSE. HPL IPO will be managed by SBI Capital Markets, ICICI Securities and IDFC Bank. The company plans to use the offer proceeds towards repayment of loans, working capital requirements and general corporate purposes. HPL is widely known as a manufacturer of electric equipment such as meters, switchgears, lighting equipment and wires & cables but has ongoing trademark litigation with Havells India Limited over the use of Havell’s name. HPL Electric’s history is rooted in Havell’s Private Limited (HPL) which sold rights of Havells brand to Qimat Rai Gupta’s company which has now turned into a INR22,900 crore behemoth called Havells India Limited.
Read Also: HPL files prospectus for INR450 crore IPO
IPO pipeline increases to 24
Both issues will be closely watched and retail investors can expect some quick action in the case of L&T Infotech. As the management has been keen to bring the IPO, the approval will surely be worked upon sooner than later. In other upcoming IPOs is Mahanagar Gas which has also started roadshows to big investors. Out of the 24 companies, AGS Transact Technologies’ validity is lapsing on 28 May and sources say the company has no plans to bring the IPO this time. SEBI’s approval is valid for 12 months and if a company fails to bring its IPO within the timeframe, it needs to file a fresh prospectus and seek fresh approval.