PN Row: Business As Usual In IPO Mkt

MUMBAI: For the first time post the market regulator’s recent clampdown on participatory notes (PNs) as many as four IPOs were inviting bids on the same day.

And on a more important note, market participants, especially investment banking fraternity, were seen keenly tracking the IPOs. Thursday witnessed two initial public offerings (IPOs) open for subscription even as two others closed for bidding.

While Religare Enterprises and Barak Valley Cements saw the close of their bidding period on Thursday, Mundra Port & Special Economic Zone and Empee Distilleries began their innings on the same day.

Incidentally, a large chunk of bids in the QIB portion is generally attributed to PNs and there were concerns that Sebi’s latest move might affect the primary market. However, market sources were quick to point out that the recent clampdown on PNs failed to stop genuine bidders from participating in the IPO.

The bidding numbers did corroborate this. Religare Enterprises saw its issue getting subscribed an impressive 156.44 times, according to data available on NSE website. Bids were received for 118.52 crore shares, as against 75.76 lakh shares on offer in the price band of Rs 160 to Rs 185. Sources further add that QIB portion has been subscribed 185 times, while HNI and retail categories have been subscribed 175 times and 70 times respectively.

In the QIB category, names of Goldman Sachs, Tata Mutual Fund, HSBC Global, Merrill Lynch, Mirae Asset and SBI Life apart from the domestic financial majors were seen doing the rounds in the market. Investment banking sources further add that Religare’s performance will create a positive sentiment for Edelweiss Capital that will open for subscription on November 15.

On a different note, IPO of Barak Valley Cements which also closed on Thursday was subscribed 28.53 times. While Mundra Port & Special Economic Zone was subscribed nearly five times on the first day of bidding, Empee Distilleries saw bids for only 18,300 shares on the first day, as against 3.31 lakh shares on offer.

The QIB portion of Mundra Port has been subscribed 6.65 times. The company received bids for 16 crore shares against 2.40 crore shares on offer. Bulk of the QIB bids has come from domestic financial majors as FIIs bid for only 4.13 crore shares.

The non-institutional segment was also subscribed nearly seven times. The retail segment, which typically attracts bids only on the last day, also received bids for 2.54 lakh shares. The IPO will close on November 7.