Shares of SREI Infrastructure Finance fell more than 2 percent intraday on Monday after sources told CNBC-TV18 that its IPO of equipment finance business is likely to be postponed or called off.
The initial public offering was planned for Q4FY18, which was rescheduled to Q1FY19 and again to Q2FY19.
Sources said investors see Srei Equipment IPO impacting wealth of SREI Infrastructure Finance’s shareholders.
Investors said turning Srei Infra into a holding company will impact stock discounting. Post Srei Equipment IPO, Srei Infrastructure will be left with no strong business of its own but merger of Srei Infrastructure & Srei Equipment will create more value for shareholders, investors feel.
Meanwhile, Srei Infrastructure told CNBC-TV18 that the IPO of Srei Equipment is neither postponed nor called off. “SREI Equipment IPO will be value accretive for stakeholders of Srei Infra. Post-IPO, Srei Infra will still have strong business-like infra financing & investments.”
In November 2017, Srei Equipment Finance filed draft red herring prospectus with capital market regulator SEBI for its IPO.
The IPO comprises a fresh issue of Rs 1,100 crore and an offer for sale of upto 43,86,765 equity shares by promoter.
Srei Equipment Finance is the leading financier in the construction, mining and allied equipment while promoter Srei Infrastructure Finance provides financial products and services for customers engaged in infrastructure development and construction, with focus on power, road, telecom, port, oil and gas and special economic zone sectors in India.
At 11:26 hours IST, the stock price of SREI Infrastructure Finance was quoting at Rs 56.65, down Rs 1.15, or 1.99 percent.