कोलकाता Kolkata (KOAA): Texmaco Rail and Engineering Ltd, a leading wagon builder, is likely to raise equity through the Qualified Institutional Placement or QIP route.
“The board has given approval to raise about Rs 300 crore of equity and QIP is one of the options being considered,” Texmaco Rail’s chief finance officer Ashok Vijay told.
The development comes on a day the government notified FDI norms for the Railways, permitting 100% overseas investment through automatic route in areas like high speed trains, suburban corridor projects, dedicated freight corridor and rolling stock among others.
The news helped Texmaco gain 4.8% closing at Rs 79.70 while Kalindee Rail Nirman among others jumped 5% to close at Rs 87.85,
The Saroj Poddar-owned listed entity is actively considering entering into some of these areas including invest in capacities of Kalindee Rail, which it earlier acquired and is now being merged with Texmaco. Texmaco also need funds for its bread-and-butter business as it has been the biggest beneficiary among wagon makers winning an order to build 2400 wagons in April.
Titagarh Wagons came second bagging order for 1538 wagons.
“It is not possible to say now exactly where the money to be raised via equity issue would be invested as the board is yet to take a call on this but it would be definitely be invested in our main rail and related engineering business,” Vijay said.
Texmaco is also expected to win a large defence order to develop and supply special purpose wagons for carrying defence equipment, chief executive officer of heavy engineering division of Texmaco, Sandeep Fuller had earlier told.
“In the wake of the recent Railway Budget, Texmaco sees a unique opportunity to grow exponentially with the largest chunk of investment proposed in the rail sector, which has hitherto suffered neglect owing to cash-strapped Railways and their lopsided populist policies. The present government has identified the high priority areas to build one of the best rail systems in the world,” the company has said in its annual report.
Texmaco is planning to emerge as the largest players in the rail segment expanding its operations from product into project segments to participate in the areas of railway signaling, communication and track work with plans to further diversify into electric traction and railway traffic management.
Further, it has joined hands with overseas players like United Rail of Australia and others to enter locomotive assemblies, metro coaches and also expand its presence in making steel bridges leveraging its large fabrication capacity. “The corporate outlook has dramatically changed for Texmaco. The new government has brought a lot of cheer to the rail sector and the gloom as been lifted by the high priority accorded for the accelerated growth of this sector,” Texmaco had said while announcing its quarterly earnings earlier.