Highway Infrastructure IPO opens with promising outlook and 28% GMP signal

Highway Infrastructure Limited, a prominent name in the infrastructure development and management sector, has launched its ₹130 crore Initial Public Offering (IPO). The issue opens for subscription on August 5, 2025, and closes on August 7, 2025, offering investors an opportunity to participate in a company that’s well-rooted in tollway collection, EPC infra development, and real estate operations.

The IPO consists of a Fresh Issue of ₹97.52 crore through 1.3931 crore equity shares and an Offer for Sale (OFS) of ₹32.48 crore by existing shareholders through 46.40 lakh shares. The price band is set at ₹65 to ₹70 per equity share, with a lot size of 211 shares, which requires a minimum investment of ₹14,770 for retail investors. High-Net-Worth Individuals (HNIs) can apply in multiples of 14 lots, translating to ₹2,06,780 as minimum HNI investment.

Strong Market Interest and GMP Indications

The Grey Market Premium (GMP) as of August 1 stands at ₹20, which translates to a 28.57% premium over the upper price band of ₹70. The expected listing price based on GMP is ₹90 per share, indicating healthy investor sentiment ahead of the listing. However, it's crucial to note that GMP trends are unofficial and speculative in nature, and actual market performance can vary.

Live Subscription Status

As of 11:30 AM on Day 2 (August 6, 2025), the IPO has already seen an oversubscription of 18.89 times, showcasing robust investor interest across all categories. A significant portion of the issue has already been taken up by anchor investors, who were allotted shares worth ₹23.39 crore on August 1 at the upper price band of ₹70 per share.

This allocation to anchor investors includes 33.42 lakh shares, and their participation reflects confidence in the company’s valuation and business prospects.

IPO Allotment and Listing Schedule

Investors can expect the allotment of shares to be finalized by August 8, 2025 (Friday). The listing of Highway Infrastructure shares on the NSE and BSE is tentatively scheduled for August 12, 2025 (Tuesday).

To check IPO allotment status, investors can visit the registrar BIGSHARE SERVICES PVT LTD’s portal and follow these steps:

• Select Highway Infrastructure Limited IPO

• Enter Application Number / PAN / DP ID

• Click Submit to view allotment status

Business Overview: Strategic Infra Focus with Stable Revenue Base

Highway Infrastructure Limited operates in three key segments:

1. Tollway Collection: Major revenue contributor, offering predictable cash flows.

2. EPC Infrastructure Projects: Includes project execution and management.

3. Real Estate Business: Complementary vertical supporting long-term asset value.

This diversified structure has helped the company build a robust financial model, while the tollway segment remains the backbone of its operations.

The company’s leadership team comprises:

• Arun Kumar Jain (Managing Director): Oversees overall operations and strategic planning.

• Anoop Agrawal (CFO & Whole-time Director): Heads finance and new business ventures.

• Ankit Tandon (CEO): Responsible for bidding, execution and operational delivery.

Consistent Financial Growth

Highway Infrastructure has shown year-on-year growth in both revenue and profits:

• FY23 Revenue: ₹456.83 crore | FY24: ₹576.57 crore | FY25: ₹504.47 crore

• FY23 PAT: ₹13.8 crore | FY24: ₹21.41 crore | FY25: ₹22.39 crore

• FY25 EBITDA: ₹40.08 crore, showing consistent operational efficiency

While there was a slight dip in revenue in FY25, the profitability improved, reflecting better margin control and cost efficiency.

Valuation and Performance Metrics

The key valuation parameters for the IPO are as follows:

• Pre-issue EPS (FY24): ₹3.40 | Post-issue EPS: ₹2.74

• Pre-issue P/E ratio: 20.58x | Post-issue P/E ratio: 25.52x

• Industry P/E ratio: Around 29x

• Return on Capital Employed (ROCE): 16.56%

• Return on Equity (ROE): 19.03%

• Return on Net Worth (RoNW): 19.03%

These metrics suggest that the IPO is fairly valued compared to industry peers and offers moderate upside potential.

Utilisation of IPO Proceeds

The company plans to deploy the net proceeds of the fresh issue as follows:

• ₹65 crore for working capital requirements

• Balance for general corporate purposes

This capital infusion will support the company’s expansion, bidding for new infra projects, and operational enhancements, especially in the toll collection segment.

Should You Subscribe to the Highway Infrastructure IPO?

Given the financial consistency, healthy GMP, moderate P/E ratio, and positive sector outlook, the IPO presents a viable short-term and medium-term investment opportunity.

Key strengths include:

• Strong presence in tollway infra projects with recurring revenues

• Experienced leadership and execution team

• Favorable financial ratios vs industry average

• Listing at a time when infra sector is gaining investor traction

However, risks such as dependency on government contracts, real estate project cycle, and economic slowdown should be considered.

Final Verdict: Apply for Listing Gains

Considering the GMP of ₹20 and listing expectation at ₹90, investors can expect up to 28% listing gains. With reasonable pricing and robust fundamentals, applying to the Highway Infrastructure IPO is recommended, especially for short-term listing benefit seekers and long-term infra investors.

Disclaimer
This article is for educational and informational purposes only and does not constitute financial advice. Investment decisions should be based on individual risk tolerance and consultation with SEBI-registered advisors. Market conditions are volatile and subject to change. Neither the author nor the platform is responsible for losses arising from use of this information.

The Upcoming IPOs in this week and coming weeks are Mahendra Realtors and Infrastructure, Bluestone Jewellery and Lifestyle, Icodex Publishing Solutions, Star Imaging and Path Lab, Medistep Healthcare, ConnPlex Cinemas, ALL Time Plastics, JSW Cement, Sawaliya Foods Products, ANB Metal Cast.

The Current active IPO are Parth Electricals & Engineering, Jyoti Global Plast, Essex Marine, Aaradhya Disposal Industries, BLT Logistics, Bhadora Industries, Highway Infrastructure.

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