The initial public offering (IPO) of Coffee Day Enterprises gained traction on Thursday, with the issue clocking 75% subscription on the second day of the book building process. The IPO had recieved 13% subscription when it opened on Wednedsay.
Bids poured in from qualified institutional bidders (QIBs) exhibiting confidence in the issue. Institutional investors bid 1.45 crore shares against 73.80 lakh shares reserved for the category, stock exchange data showed. The QIB book was subscribed nearly two times as on Thursday evening.
The non-institutional category, comprising high net worth individuals (HNIs) bid for 3.89 lakh shares out of 53.87 lakh shares on offer. Retail investors subscribed 41.93 shares against an offering of 1.25 crore shares.
On Tuesday, the Bengaluru-based company, that runs Cafe Coffee Day outlets, had raised around Rs334.27 crore through a pre-IPO placement to anchor investors. A little over 1.03 crore shares were allotted to 17 institutional investors at a price of Rs322 a piece. List of anchor investors included Blackrock, Government Pension Fund Global, ICICI Prudential Mutual Fund, Merrill Lynch, Swiss Finance Corp and Axis Mutual Fund.
The public issue, which closes on Friday, is priced at Rs 316-328 per piece. The company aims to raise a total of Rs 1,150 crore public investors to pay back existing debts and for general corporate purposes. The company aims to retire Rs 632.8 crore of its total debt, according to information made available in the draft prospectus.
Kotak Investment Banking, Citigroup, Morgan Stanley, Axis Capital, Edelweiss and Yes Bank are the lead book running managers for the issue.
Coffee Day Enterprises is the parent company of Coffee Day Group and the company operates the largest chain of coffee stores in India. The company also has presence in real estate sector through a subsidiary, Sical Logistics. It also owns a 16.75% equity holding in information technology company, Mindtree.
If successful, Coffee Day’s IPO will be the biggest IPO by value since December 2012 – when Bharti Infratel’s raised Rs 4,155 crore. During the calendar 2015, fifteen companies have raised close to Rs 6,500 crore from primary markets so far.