Dilip Buildcon IPO subscribed 69.5% on Day 2

Dilip Buildcon IPO receives applications for 14.85 million shares, led by high net-worth individuals and retail investors


A file photo of the National Stock Exchange. Retail investors, whose investments cannot cross <span class='WebRupee'>Rs.</span>2 lakh in an IPO, submitted bids for 67.40 million shares for the 10.61 million shares on offer. Photo: Aniruddha Chowdhury/Mint
A file photo of the National Stock Exchange. Retail investors, whose investments cannot cross Rs.2 lakh in an IPO, submitted bids for 67.40 million shares for the 10.61 million shares on offer. Photo: Aniruddha Chowdhury/Mint

Mumbai: The initial public offering (IPO) of construction and road building company Dilip Buildcon Ltd received bids for 69.52% of the shares on offer at the end of Tuesday, the second day of a three-day offering.

By 5:30pm, the IPO had received applications for 14.85 million shares, led by high net-worth individuals (HNIs) and retail investors. The company and existing shareholders are selling 21.36 million shares in the IPO.

Retail investors, whose investments cannot cross Rs.2 lakh in an IPO, submitted bids for 67.40 million shares for the 10.61 million shares on offer, stock exchange data showed.

The institutional investor book was subscribed 49%, while the non-institutional category comprising high net-worth individuals was subscribed 1.02%.

On Friday, Dilip Buildcon raised Rs.196.19 crore by allotting shares to anchor investors. The firm sold a little more than 8.95 million shares to 10 anchor investors at Rs.219, the upper band of the Rs.214-219 price band for the issue.

Investors acquiring shares in the anchor allotment include SMALLCAP World Fund Inc., Abu Dhabi Investment Authority, HDFC Trustee Co., Nomura Singapore Ltd and DB International Ltd.

The anchor book is that portion of an IPO which bankers allot to institutional investors on a discretionary basis. Anchor book subscription opens a day before the IPO launch and is an indicator of institutional investor interest.

Through the IPO, the company and its promoters aim to raise a total Rs.664 crore through fresh issue of shares and share sale by Dilip Suryavanshi and Devendra Jain and private equity fund BanyanTree Growth Capital.

BanyanTree, which currently holds about 9.75% in the company, will sell about 6% stake or 7.95 million equity shares through the IPO.

The company proposes to use the proceeds of the fresh issue for prepayment or repayment of a portion of term loans, and for working capital.

Axis Capital Ltd, IIFL Holdings Ltd, JM Financial Institutional Securities and PNB Investment Services Ltd are lead managers to the issue.

The IPO market in 2016 has retained the momentum witnessed in 2015, when 21 companies went public, raising Rs.13,614 crore. So far this year, 15 companies have raised about Rs.10,500 crore through the IPO route.

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