JSW Cement shares list at 4% premium over IPO price

Sajjan Jindal-promoted JSW Cement made a muted debut on Indian stock exchanges on Thursday, despite receiving a strong response to its ₹3,600 crore initial public offering (IPO). The shares of JSW Cement listed at ₹153 on the BSE, a premium of 4.08% against the IPO price of ₹147 apiece, with a market capitalisation of ₹20,859.48 crore. On the NSE, the JSW Group stock debuted at ₹153.50 per share, up 4.42% over the issue price.

Meanwhile, the equity benchmarks, BSE Sensex and NSE Nifty, were trading higher by 0.15% each, led by IT, pharma, healthcare, and financial services stocks.

The listing was in line with Street expectations as the cement stock was commanding grey market premium (GMP) of ₹4.5 in the unlisted market, indicating listing price to be around ₹151.5 per share, up 3.06%.

This is the first major IPO in the cement sector since Nuvoco Vistas’ ₹5,000 crore issue in August 2021. It has also become the fourth company of the steel-to-power conglomerate to be listed on the domestic bourses, following JSW Infrastructure in October 2023.

“It’s a momentous occasion for the group. It is the largest IPO the group has ever undertaken, at ₹3,600 crore. We’ve never raised this much capital in an IPO before,” said Parth Jindal , managing director of JSW Cement, in an interaction with Fortune India during IPO press meet.

JSW Cement IPO booked 7.7 times

The IPO, which opened for bidding between August 7-11, sailed through on the last day of bidding, aided by strong demand from qualified institutional buyers (QIBs) and non-institutional investors (NIIs). The issue was a combination of fresh issue of equity shares worth ₹1,600 crore and offer for sale of ₹2,000 crore, offered at a price band for ₹139-₹147 per share.

The issue was overall subscribed 7.77 times as JSW Cement IPO attracted bids for 140.91 crore shares against the 18.13 crore shares offered across categories, the exchange data showed. The issue was booked 15.80 times in QIB segment, 10.97 times in NII category, while the quota reserved for retail investor was booked 1.81 times.

Out of the fresh equity capital, JSW Cement aims to use ₹800 crore for funding the cost of establishing a new integrated cement unit at Nagaur (Rajasthan), and ₹720 crore to repay debts availed by it. A part of the capital will be utilised to meet general corporate purposes. As of March 31, 2024, the total debt under the various financing arrangements of the company stood at ₹5,835.76 crore.

Ahead of opening of the public issue, the JSW group company raised ₹1,080 crore from anchor investors by allotting over 7.3 crore shares at the upper price band of ₹147 per equity share. Over 44% of the anchor book quota was allocated to 9 domestic mutual funds, which applied through a total of 20 schemes. SBI Mutual Fund, SBI Life Insurance Company, Nippon Life India, Tata Mutual Fund, Motilal Oswal Mutual Fund, Aditya Birla Sun Life AMC, Baroda BNP Paribas MF, Edelweiss Life Insurance and others participated in the anchor book.

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