Texmaco Rail launches Rs 750-crore QIP issue, shares may extend rally

Shares of Texmaco Rail may extend previous session rally on November 22 as the company has launched its Qualified Institutional Placement (QIP) to raise Rs 750 crore at a floor price Rs 135.90 a share. The issue also includes a green shoe option of Rs 200 crore.

Qualified institutional placements are a way to issue shares to the public without going through standard regulatory compliance. Qualified institutional buyers (QIBs) are the only entities allowed to purchase QIPs. Green shoe option typically allows underwriters to sell more shares than the original issue amount.

The Kolkata-based engineering and infrastructure company plans to use the funds raised through the QIP issue for various purposes, including funding capital expenditures, repayment of borrowings, supporting working capital needs, and general corporate purposes.

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In the previous session, shares of Texmaco Rail & Engineering Ltd surged as much as 6.5 percent before trimming some gains to settle at Rs 149.90 on the National Stock Exchange. The multibagger counter has gained more than 150 percent so far in 2023.

The counter was last trading higher than the 5-day, 10-, 20-, 30-, 50-, 100-, 150-, 200-day simple moving averages (SMAs). The counter’s 14-day relative strength index (RSI) came at 71, signalling that it is in overbought territory.

Meanwhile, goth BSE and NSE have put the securities of Texmaco Rail under the long-term ASM (Additional Surveillance Measure) framework. Exchanges put stocks in short-term or long-term ASM frameworks to caution investors against high volatility in share prices.

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For the quarter ended September 2023, Texmaco Rail and Engineering reported a 70 percent on-year jump in consolidated net profit to Rs 20 crore. Its consolidated total income rose 64 percent YoY to Rs 810 crore. The consolidated revenue from operations also surged 66 percent on-year to Rs 805 crore.

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