InvestorQ : Can you updated about how was the subscription response to the IPO of Electronic Mart that closed on Friday?
Tisha Malhotra made post

Can you updated about how was the subscription response to the IPO of Electronic Mart that closed on Friday?

Aashna Tripathi answered.
1 month ago

The IPO of Electronic Mart India worth Rs500 crore closed on Friday the 07th of October. The response was tremendously strong on Day-1 and Day-2 of the IPO as well as on Day-3. There was strong demand coming from the QIB segment or the qualified institutional buyer segment as well as robust demand from the HNI segment. The demand was especially strong in the Rs10 lakh plus category of higher value HNIs. However, there was strong to sedate demand from the retail segments. The issue has already closed for subscription on 07th October 2022 and here is a quick summary of how the various segments subscribed.

Let us look at the overall macro picture first. As of close of the IPO, out of the 625.00 lakh shares that were available on offer in the IPO, Electronic Mart India got overall bids of 44,953.65 lakh shares. This translates into an overall subscription of 71.93X. The break-up of subscriptions was dominated largely by the qualified institutional buyers or the QIBs while the HNIs also built up a lot of heft on the last day of subscription. The QIB bids and NII bids by default gather momentum on the last day, and that is what we saw in this issue too. This is the fifth consecutive issue to get a very good issue response.

Before we got to the QIB subscription, we first look at the anchor allocation a day ahead of the IPO opening. The total anchor placement was of 2,54,23,728 shares or 2.54 crore shares at the upper end of the price band of Rs.59. This was allocated to a total of 20 investors to raise Rs.150 crore in the process. The residual amount is part of the public issue of Electronic Mart India. The QIB portion outside anchor had a quota of 178.57 lakh shares of which it received bids for 30,275.88 lakh shares implying oversubscription of 169.54 times. Most of the oversubscription happened on the last day, but that is normal for QIBs.

Let me now turn to the HNI segment of the IPO. It was oversubscribed 63.59 times. Out of the total quota of 133.93 lakh shares, they got bids for 8,516.90 lakh shares. As is the norm, the bulk of funded applications and corporate applications, come in on the last day. As you are aware, as per the latest rules, NII / HNI portion is broken up and reported in 2 parts. The bids below Rs10 lakhs (S-HNI) got oversubscribed 58.42 times while the bids above Rs10 lakhs (B-HNI) got oversubscribed 66.18 times. However, the overall HNI subscription still remains the same and this is only for the information purposes.

Let me finally come to the retail portion of the IPO of Electronic Mart. The retail portion was subscribed 19.71 times at the close of the issue, which is good considering that 35% allocation is for the retail investors. Out of the 312.50 lakh shares on offer in the retail quota, the IPO got valid bids for 6,160.86 lakh shares. This included bids for a total of 5,345.56 lakh shares received at the cut-off price. In a cut off price bid, the applicant does not mention the intended bidding price but is more of a price taker. They are willing to take any price discovered. The IPO was priced in the band of (Rs.56-Rs.59).