The current year 2017 has been one of the best year for India’s primary markets as India Inc raised more than 67,000 crore in the year through IPOs. A few IPOs had received blockbuster subscription even as retail investors and institutions queued up to to pick up huge stake in these IPOs. Latest to join the list of grossly oversubscribed issues is the IPO of Astron Paper and Board Mill Ltd which got subscribed by more than 243 times last week, and scheduled to list on bourses tomorrow.
Year 2017 has seen the highest number of grossly oversubscribed issues. Notably, the IPO of Salasar Techno Engineering saw investor subscription to the tune of 273.05 times in July-17 for its Rs 36 crore IPO in July this year, making it the first company in over 17 years to be oversubscribed by more than 270 times, after Sankhya Infotech. Interestingly, experts say that the trend is likely to continue in 2018 too.
“This year saw inflows of about $24 billion into Indian markets from local and overseas investors, all of which has been absorbed by an equivalent infusion of fresh paper, thereby helping mitigate the risk of an asset bubble. We expect the same trend in 2018,” V Jayasankar, head of equity capital markets at the investment banking unit of Kotak Mahindra Bank Ltd told Bloomberg.
Amid all the euphoria in the primary markets, a few IPOs have more than tripled investor wealth in 2017 alone. We take a look at three such public offers.
Apex Frozen Foods
In less than four months, the shares of Apex Frozen Foods have risen by a staggering 380%. The issue of aquaculture products exporter was subscribed by more than 6 times, amid demand from retail and non-institutional investors. Notably, the issue price was Rs 175, and the shares today closed at Rs 840 on NSE. The company had come out with its Rs 152 crore IPO between August 22 and August 24. The issue comprised of fresh issue of 72,50,000 shares and an offer for sale of 14,50,000 shares. Apex Frozen Foods Ltd, debuted on the exchanges by listing at Rs 202 on NSE, and further soared more than 21% to hit the upper circuit on NSE at Rs 212.50 on the same day.
Shankara Building Products
Shares of Shankara Building Products have returned more than 295% since listing on stock exchanges. The home building products retailer Shankara Building Products got a bumper listing on stock exchanges in April this year, with its shares opening on NSE at Rs 555.05, up 20.66%; and on BSE at Rs 545, up 18.5% from the issue price of Rs 460. Soon after, the shares made the day’s high of Rs 629.15 on NSE and Rs 627.6 on BSE. The strong listing was on the expected lines, as the issue was subscribed 41.88 times. The shares closed at Rs 1,785 on NSE this afternoon.
Shares of billionaire Radhakrishnan Damani-led Avenue Supermarts have returned more than 284% since IPO in March. The initial public offer of D-Mart parent Avenue Supermarts to raise Rs 1,870 crore had been subscribed by a staggering 104.48 times at the end of the three-day bidding. The portion set aside for qualified institutional buyers (QIBs) was oversubscribed 144.6 times and that of non institutional investors 277.74 times. Shares of the company surged by more than 100%, and listed at Rs 604.4, as against an issue price of Rs 299. The shares closed at Rs 1,150 on NSE this afternoon.