(Reuters) -JSW Cement’s [JSWC.NS] 36-billion-rupee ($413 million) IPO was fully subscribed on the third day of bids on Monday, as investors bet on the Indian firm’s long-term growth prospects backed by the government’s push in infrastructure and housing.
Cement makers in India, the second-largest global producer of the material, have bet on rising government spending on infrastructure and an upbeat housing sector to drive demand, spurring increased dealmaking over the past few years.
Cement demand is expected to grow 6%-7% annually through 2030, Moody’s Ratings said in a note in May. Analysts also forecast prices strengthening as they recover from last fiscal year’s multi-year lows.
Total bids were 1.31 times the shares on offer, exchange data showed as of 1:00 p.m. local time. Institutional as well as retail investors matched the allotted share portions on offer for them.
Shares of the cement maker, which aims for around a $2.3 billion valuation, are slated to list on August 14 on the National Stock Exchange and the Bombay Stock Exchange.
JSW Cement, which operates seven plants in India’s southern, eastern and western regions, is a smaller player in an industry dominated by Aditya Birla Group-backed UltraTech and Gautam Adani-backed Ambuja.
The Mumbai-based firm, part of the autos-to-steel JSW conglomerate, filed for an offering last August, with proceeds from fresh issue planned to fund a factory in the limestone-rich state of Rajasthan. It was approved by India’s markets regulator in January.
JSW Cement has a competitive edge as “access” to group companies across steel, energy and marine infrastructure sectors sets it up for sourcing key raw materials such as blast furnace slag and power at “easy and competitive terms,” said brokerage Anand Rathi Research in a note in July.
(Reporting by Hritam Mukherjee in Bengaluru; Editing by Harikrishnan Nair)
