The allocation of shares in RailTel IPO, which has been subscribed more than 42 times, is likely to be finalized today, according to the brokerages. Applicants for the RailTel IPO can check the award status on the website of KFin Technologies, which will manage the allocation and redemption of shares, or on ESB website. RailTel shares are likely to be listed on February 26.
RailTel IPO had a price range of ₹93-94 per share. In this IPO, the government sells 27.16% of the capital.
The ₹RailTel’s 819 crore IPO was opened between February 16 and February 18. The offer received offers for 22.214.171.124,370 shares against 6.11.95 923 shares offered. The retail retail investor segment was underwritten over 16 times, while Qualified Institutional Buyers (QIBs) were underwritten 65.14 times and Non-Institutional Investors 73.25 times.
ICICI Securities, IDBI Capital Markets & Securities Limited and SBI Capital Markets were the managers of the offer.
Before the IPO, RailTel had raised ₹244 crore from 14 anchor investors.
Many brokerage firms had also recommended subscribing to the show.
“RailTel derives 66% of its revenues from the telecommunications segment, while the rest comes from railways and other projects. RailTel, if functioning efficiently, can benefit from the growth of 5G in India from a fiber needs perspective. It could also play a key role in the digital transformation of railways. In addition, Covid-19 has had minimal impact on the telecommunications industry and has actually triggered growth for some players due to the increased use of data and VPN services for people working from home, ”said Nirali Shah, Head of Equity Research, Samco Securities.
“Since RailTel is a debt-free company that pays consistent dividends, it might experience some traction, but for long-term investors there are some red flags. First, the company generated single-digit revenue and CAGR PAT of 7.5% and 2.5% respectively as of fiscal 2018 There is a high dependence on government entities and a concentration risk given that 23.8% of its revenues come from the 3 main clients. Its presence in a highly regulated industry is another source of concern. Overall, the company’s price is reasonable at its 21.3x FY20 P / E, ”she added.
RailTel Corporation of India, a central public sector company 100% owned by the Government of India and under the administrative control of the Ministry of Railways, is an information and communication technology (ICT) infrastructure provider and one of the largest providers of neutral telecommunications infrastructure in India. A neutral telecommunications infra provider is a third party that has little or no role to play in providing Internet services to the end user, but that allows interconnection between multiple telecommunications operators. RailTel also undertakes various ICT projects for Indian railways, central government and state governments.
The allocation of shares in the IPO of Nureca Limited is also likely to be finalized on February 23. Link Intime India Private Ltd is the registrar of the issue and will manage the allocation and redemption of the shares. Investors can check the status of their application on the Registrar or BSE website.