Advanced Enzyme Technologies Ltd’s initial public offering (IPO) on Wednesday—the first day of the public offer—witnessed 89% subscription, according to data from stock exchanges.
As of 7pm, the institutional portion of the share sale was subscribed 41%, while the allocations for retail and high net-worth individuals (HNIs) were subscribed 149% and 17%, respectively, according to the data.
The public offer closes on Friday. The company has fixed a price band of ₹ 880-896 per share for the IPO through which it is looking to raise around ₹ 412 crore.
Advanced Enzyme is engaged in manufacturing, marketing, research and development of 400-plus proprietary products developed from enzymes.
Investment banks Axis Capital Ltd and ICICI Securities Ltd are managing the share sale.
On Tuesday, the company allotted shares worth ₹ 122.85 crore as part of the anchor book allotment ahead of its IPO.
The anchor book is that portion of the IPO which bankers can allot to institutional investors on a discretionary basis. Anchor book subscription opens a day before the launch of an IPO and acts as an indicator of institutional investor interest.
Shares were allotted to the anchor investors at the upper end of the price band of ₹ 896 per share.
A total of 15 institutional investors participated in the company’s anchor book allocation. DB International (Asia) Ltd and Kuwait Investment Authority were the foreign investors in the anchor book. HDFC Mutual Fund, Reliance Capital Ltd, ICICI Prudential Life Insurance, SBI Life Insurance, Birla Sun Life and L&T Mutual Fund were among the domestic investors who picked up a stake in the anchor book allotment.
The public offering of Advanced Enzyme is a mix of primary fund-raising and a secondary share sale by existing investors of the company. The company is looking at raising ₹ 50 crore in primary capital through the IPO, which will be used for investment in Advanced Enzymes USA, its subsidiary, for repayment of certain loans.
In fiscal year 2015-16, the company reported a revenue of ₹ 294.6 crore, up from ₹ 224.2 crore the previous year. In 2015-16, its profit stood at ₹ 78.4 crore, up from ₹ 50.1 crore the previous fiscal year.
Advanced Enzyme’s share sale comes at a time when the IPO market has seen significant momentum in the last few weeks. On 1 July, the IPO of integrated business services provider Quess Corp. Ltd (QCL) received subscriptions that were 144.31 times the issue size of ₹ 400 crore, registering the fifth highest overall subscription (in percentage terms) for any IPO since 2000.
Last week, L&T Infotech Ltd’s ₹ 1,243 crore IPO was subscribed more than 11 times.
So far this year, 13 companies have raised around ₹ 9,425.5 crore through IPOs, while last year 21 firms raised ₹ 13,614 crore from their initial share sales, according to data from Prime Database, a primary market tracker.