Favourable response to the major issue by Adani Power could be an indicator of the revival of the initial public offer (IPO) market. The Rs 3,000 crore IPO has seen the issue getting ?subscribed four times? on its first day of subscription receiving bids for 98.49 crore equity shares against the issue size of 30.16 crore equity shares.
Interest in the issue has been high on the institutional side. On Monday, as many as ?six anchor investors? picked up the entire portion reserved under the anchor investor scheme for Rs 502 crore at Rs 95 per share. ?Anchor investors? are institutional investors wanting to stay with the company for a longer period. This is the first public issue that had offered recent Sebi prescribed guidelines of ?minimum 30% of the portion? reserved under the qualified institutional buyers (QIB) to anchor investors. In the case of Adani Power anchors include, T Rowe Price International, AIC Advantage Fund, Ecoffin Global Utilities Masters Fund, Sundaram BNP Paribas Mutual Fund, CLSA Mauritius and Credit Suisse. Experts feel the overwhelming response to the issue is fairly a first sign of revival in the primary market. Earlier, the Rs 300 crore public issue from Mahindra Holidays and Resorts India got subscribed by nearly 10 times. ?Going by the interest shown by anchor investors to the issue, foreign investors are very much interested in buying into India?s growth story. This can be seen as an initial signs of revival in the primary market?, said Gopal Agrawal, head of equity ? Mirae Asset Global.
Improvement in investors? risk appetite can also be seen in the secondary market which has managed to stay relatively stable in the last few weeks. ?Market moving in a ?range bound manner? is a signal of consolidation, which is a very healthy sign?, added Agrawal. On Tuesday, the domestic equity bourses ended the day with marginal losses. The 30-share Sensex of the Bombay Stock Exchange (BSE) ended the day at 15,331 points marginally down by 43.10 points or 0.28%. The Nifty closed the day at 4,564.10 points down marginally by 0.18% or 8.20 points.
However, the market breadth, indicating overall health of the market, remained positive with 1,709 stocks in BSE advancing when compared to 945 that saw a decline.
As a result, the BSE mid ?cap and small-cap indices gained 1.13% and 1.68%, respectively.
Improvement in sentiments is also because of better earnings reported by India Inc. Tata Motors stock, for instance, zoomed by 10.47% or Rs 39.25 to close the day at Rs 414.20 after the company came out on Monday with impressive first quarter results reporting increase in net profit by 58% to Rs 513.76 crore for the first quarter ended June 30.