GIC IPO, India’s second biggest initial public offer so far, saw dull response after a stellar showing on the opening day, and crawled to over 100% subscription on Friday afternoon, but yet remained undersubscribed. The Rs 11,370 crore-IPO of General Insurance Corporation Re was subscribed 135% on the third day of bidding, as QIBs (qualified institutional buyers) queued up to pick up a stake in India’s largest re-insurer, as their quota was oversubscribed 2.27 times. However, retail investors were still staying away with their quota still undersubscribed just about half at a mere 53%. According to the company’s prospectus, the undersubscription in any of the categories, except the QIB’s, would be met with spill-over from any other category, or combination of categories, at the discretion of the company, and the discretion of the selling shareholder in and consultation with the exchange.
There is also clear contrast seen in the bid orders between Bombay Stock Exchange and National Stock Exchange as the subscription on NSE stood at 90% while it was just 45% on BSE. GIC is expected to raise Rs 11,372.64 crore at the upper end of the price band of Rs 912. The company has set a price range for the issue between Rs 855 to Rs 912 per equity share. GIC IPO is India’s second-largest public offer since Coal India’s Rs 15,200 crore and Reliance Power’s Rs 10,123.2 crore share sale — which was at the second spot before GIC IPO, now slipped to the third place.
The shares allocated for the NII (non-institutional investors) category got subscribed 22% . The bids received for the shares reserved for employee category was subscribed 61%. General Insurance Corporation is first of the five state-run non-life insurance firms to initiate a stake sale and listing process.
Citigroup Global Markets India Private Limited, Axis Capital Limited, Deutsche Equities India Private Limited, HSBC Securities and Capital Markets (India) Private Limited, Kotak Mahindra Capital Company Limited are the book running lead managers of the issue.