The retail quota saw huge applications and was fully subscribed within 45 minutes of the bidding process. Of the 65,59,173 shares on offer, the issue had received requests for 51,86,588 shares. Of the 32.83,580 shares on offer for retail investors, the issue had received a request for 51.08,928 shares, which means a subscription of 1.55 times.
The quota for non-institutional investors or high net worth investors was subscribed only 0.05 times, while the QIB quota had not received applications yet.
The Vadodara-based company plans to raise Rs 318 crore and is offering a new issue of equity shares, adding up to Rs 165 crore and offer for sale of up to 45,00,000 equity shares, to be sold in the price range of Rs 338. -Rs 340.
On Friday, the company raised Rs 95.40 crore by allocating shares of 28.06 lakh to anchor investors at Rs 340 per share.
On the gray market, the company’s shares were trading at a premium of Rs 275 per share, or 81% more than the price band set for the IPO.
Analysts said the issue calls for an economic valuation of 25.5 times FY20 earnings per share and that the company could benefit from a shift in demand from China. But the high concentration of clients, the criminal process against a promoter and the limited portfolio are risks for the company.
Most of the brokers had ‘underwriting’ ratings on the shares. Choice Broking said the company’s fundamentals look positive, but the corporate governance issue of the developer and developer group makes it cautious.
“In addition, the specialty chemical sector was re-rated in the last 5-6 months. Before re-rating, the pairs were available with lower valuations. Therefore, considering the above observations, we assigned a rating of ‘Subscribe with caution ‘for the problem, “Choice said.
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