Goswami Infra Seeks Waivers for Afcons IPO Amid Capital Market Hurdles and Debt Repayment Push

Mumbai: Goswami Infratech, part of the Shapoorji Pallonji Group, has asked its bondholders for more time and certain waivers related to the upcoming IPO (Initial Public Offering) of Afcons Infrastructure, another company within the group.

In a letter to bondholders, Goswami Infratech assured those holding ₹14,300 crore worth of non-convertible debentures (NCDs) that it isn’t asking to change the pricing conditions for the IPO. Instead, they need extra time to meet certain rules set by capital market regulators.

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Additionally, the company has requested more flexibility in selling the remaining Afcons shares it will hold after the IPO. It has also asked for approval to open pre-IPO sale bank accounts, promising that the funds from these sales will be used to pay off debts once the shares are listed on the stock market.

The IPO price range for Afcons will only be decided after the red herring prospectus (RHP) is filed with the Registrar of Companies. Once that is done, the company will update its bondholders.

Afcons has already received approval from SEBI, India’s market regulator, for an ₹8,400-crore IPO. The listing could happen anytime this month.

If the IPO is delayed beyond a set deadline, Goswami Infratech has promised to return funds to investors and recreate a pledge on Afcons shares. The company has also been given an extension to repay its NCDs, pushing the deadline from September 30 to December 31, 2024, as it works on refinancing its debt through Sterling Investment Corporation, the group’s parent company.

The Shapoorji Pallonji Group is working to reduce its debt by selling off assets like Gopalpur Port and through the Afcons IPO. However, delays in these plans have resulted in a 400 basis-point increase in interest rates. The ₹14,300-crore fund, raised at an interest rate of 18.75% from global investors like Davidson Kempner and Ares in June 2023, now carries a higher rate of 22.75%.