Pipavav Shipyard IPO opens with a bang - Issue fully subscribed within 1st hour

MUMBAI, September 16, 2009: The IPO of India’s largest dockyard Pipavav Shipyard opened with a bang today with the issue getting fully subscribed within the 1^st hour. According to information available with the stock exchanges, the issue was subscribed nearly 2.67 times by 5 PM today.

Building India’s largest dry dock and multi-sector fabrication facility, Pipavav Shipyard hit the capital market targeting to raise over Rs 510 crores. The issue of over 85.45 million equity shares of Rs 10 each with a price band of Rs 55-Rs 60 through a 100% book building process closes on Friday.

The company yesterday received commitment of Rs 92 crores from six top anchor investors ahead of the IPO yesterday. The anchor investors - Batterymarch Financial Management Inc. A/C Legg Mason Emerging Markets Trust, Commonwealth Equity Fund Limited, California Public Employee’s Retirement System managed by Batterymarch Financial Management Inc, GI India II, India Diversified (Mauritius) Limited and Marshal India Select Fund Limited - subscribed to the IPO at Rs 60 each - the higher end of the price band.

The company intends to use the IPO proceeds for Construction of facilities for shipbuilding, ship repair and the Offshore Business among other things.

Pipavav Shipyard enjoys a strong order book position of 34 ships – 22 Panamax size huge dry bulk carriers for 3 European shipping companies and 12 OSVs for ONGC. It has also bid for 7 naval vessels.

Pipavav Shipyard also intends to focus on building ships for the military and the government, initially focusing on vessels for the Indian navy and coast guard. In addition, Pipavav Shipyard intends to utilize its shipbuilding facilities to repair a wide range of vessels, including VLCCs and OSVs, as well as naval, coast guard and other specialty vessels such as LNG carriers.

Its dry dock, measuring 662 meters in length and 65 meters in width, is capable of accommodating ships of up to 400,000 DWT and/or multiple combinations of smaller vessels including vessels catering to offshore activities such as offshore supply vessels (OSV), anchor handling tug supply vessels and multi-purpose support vessels. Installation of two Goliath cranes, each having a lifting capacity of up to 600 tonnes, is also in progress.