Prabhat Dairy’s initial public offering (IPO) managed to sail through on Friday, after the issue was extended by three days and its price band lowered. The issue received muted response in the aftermath of a selloff in global equities.
Merchant bankers to the issue claimed that the IPO’s fresh issue was subscribed more than one time, thus meeting the capital market regulator’s minimum subscription provisions.
According to the Issue of Capital and Disclosure Requirement (ICDR), a company is required to achieve minimum subscription clause of 90% of the fresh offer size.
Overall, the issue was subscribed 0.77 times without a single bid from FIIs, data from stock exchanges showed. The non-institutional book comprising HNIs was subscribed 1.42 times and the retail portion got just 0.34 times demand against the shares reserved for the category. “The issue has successfully gone through,” said Vikas Khemani, CEO, Edelweiss Financial Services. “Given the recent developments in global markets and the selloff thereafter, the IPO has done well,” Khemani said.
Prabhat Dairy’s IPO included a fresh issue of nearly 2.65 core shares worth R300 crore and an offer for sale of 1.47 crore shares from existing investors.
The IPO was extended by three days as the issue failed to get fully subscribed as on September 1 — the final day of offering. The price band has been revised to R115-126 from the original band of R140-147 per share. As a result, the overall issue size was lowered to R485.22 crore from R516 crore. However, the size of fresh issue — R300 crore — remained intact.