Mumbai: The ₹ 664 crore initial public offering (IPO) of construction and road developing company Dilip Buildcon Ltd attracted bids for 20.91 times the number of shares on offer, stock exchange data showed.
At the end of the last day of the three-day offering, the IPO attracted bids for more than 446.82 million shares, compared with an issue size—excluding the anchor book—of 21.36 million shares. At the lower end of the ₹ 214-219 price band for the issue, the IPO drew bids worth roughly ₹ 9,562.06 crore.
The institutional investor category was subscribed 9.75 times, receiving bids for 60.5 million shares. The non-institutional category comprising high net worth individuals was subscribed 79.63 times.
Demand from retail individual investors, whose investments cannot exceed ₹ 2 lakh in an IPO, stood at 2.27 times the 10.61 million shares on offer, exchange data showed.
On Friday, Dilip Buildcon raised ₹ 196.19 crore by allotting shares to anchor investors. The company sold a little more than 8.95 million shares to 10 anchor investors at ₹ 219 each, the upper end of the ₹ 214-219 price band.
Investors who bought shares in the anchor allotment included 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 firm and its promoters aim to raise a total of ₹ 664 crore through fresh issue of shares and share sales by Dilip Suryavanshi, Devendra Jain and private equity fund BanyanTree Growth Capital.
BanyanTree, which currently holds about 9.75% in the company, will sell a stake of about 6%, or 7.95 million equity shares, through the IPO.
The firm proposes to use the net 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.
Bhopal-based Dilip Buildcon, which in 1989 started out with a real estate construction business, and later entered water treatment and sewage treatment, builds roads, dams, canals and residential buildings on an engineering, procurement and construction basis.
This was the firm’s second attempt at an IPO. Last year, it had planned to raise about ₹ 650 crore through an IPO, but dropped the plan citing the cautious sentiment of foreign institutional investors towards the sector.
Several of its peers, including Sadbhav Infrastructure Projects Ltd, Ashoka Buildcon Ltd and IRB Infrastructure Developers Ltd, are already listed on the bourses.
The IPO market in 2016 regained the momentum that was witnessed in 2015, when 21 firms went public, raising ₹ 13,614 crore. So far this year, 15 firms have raised about ₹ 10,500 crore through IPOs, according to data from Prime Database, a primary market tracker.