It seems domestic primary markets have got some magnetic power this year as all the 14-initial public offerings (IPO) which hit capital markets in 2016 have oversubscribed up to 145 times. In the list, staffing firm Quess Corp IPO got oversubscribed by 144.50 times, followed by Advanced Enzyme (116.91 times), Thyrocare Technologies (73.55 times), TeamLease Services (66.25 times), Mahanagar Gas (65.28 times) and Ujjivan Financial Services (40.68 times).
Other public offers such as Equitas Holdings, Larsen & Toubro Infotech, Quick Heal Technologies, Precision Camshafts, Parag Milk Foods, Healthcare Global, Bharat Wire Ropes and Infibeam Incorporation oversubscribed by 17.24, 11.69 , 10.97, 1.91, 1.84, 1.56, 1.27 and 1.11 times, respectively. After listing on bourses, most of them are present trading above their issue price.
Barring the Healthcare Global Enterprises in which retail investors category was subscribed by 0.83 times, all other IPOs got robust response from retail category also. Retail investors category was oversubscribed by 31.22 times and 11.67 times in Quess Corp and Advanced Enzyme Technologies, respectively.
Going ahead, market experts are expecting the same interest from investors as IPOs from RBL Bank, ICICI Prudential are in pipeline.
Of late, ICICI Prudential Life Insurance Company have announced that it will bring public offer this year. Rahul Rege, business head-retail, Emkay Global Financial Services said, “We can see some more IPOs from insurance companies. We can see HDFC Standard Life, SBI Life, Reliance Life coming soon with their IPOs after ICICI Prudential.”
On the proposed IPO of ICICI Prudential, he said, “With a context of ICICI Prudential an investor can apply as it would be the first insurance companies getting listed in India and its parent company ICICI Bank is trading at Industry price-to-earnings ratio.”
He further advised investors that one can buy IPO of those companies whose business model is unique, having competitive advantage, like recent IPO of Advance Enzyme Technologies and others already listed IPO like Quess Corp, Ujjivan Financial Services ltd. Retail Investors are Investing in IPO for listing gains so in general if the business models are unique (with monopoly in business) and subscription numbers high in overall category probability of gains on listing are there subject to market scenario on the day of listing.
Now, Dilip Buildcon will be raising over Rs 430 crore through IPO and offer for sale, which will be primarily used to retire its debt and fund working capital requirements. The company has fixed price band of Rs 214-219 per share with a face value of Rs 10. The issue will open for subscription on August 1 and close on August 3.