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The initial public offering (IPO) of microcrystalline cellulose manufacturer Sigachi Industries received a whopping 101.91 times subscription on the last day of the offer last week on November 3. The IPO received bids for 54,89,47,440 shares against 53,86,500 shares on offer that had opened on November 1. 

The portion for non-institutional investors was subscribed 172.43 times, those meant for Qualified Institutional Buyers (QIBs) 86.51 times and Retail Individual Investors (RIIs) 80.49 times. The finalization of the basis of share allotment was done this week.

As per market observers, Sigachi Industries shares have surged in the grey market and are commanding a premium (GMP) of 220 today. The shares of the company are expected to list on leading stock exchanges NSE and BSE on November 15, 2021. The price range for the 125.42 crore-offer was at 161-163 per share.

The IPO of the Hyderabad-based manufacturer of cellulose-based excipients, consisted of a fresh issue of 7.70 million shares up from earlier planned of up to 2.84 million shares.

Sigachi Industries is engaged in the manufacturing of Microcrystalline Cellulose (MCC) which is widely used as an excipient for finished dosages in the pharmaceutical industry and has varied applications in food, nutraceuticals, and the cosmetic industries. It carries out its operations from three manufacturing units situated at Hyderabad, Jhagadia, and Dahej in Gujarat.

The proceeds from the issue will be used for expansion of production facilities of MCC at Dahej and Jhagadia in Gujarat. The expansion will add 3,600 MTPA capacity to the Dahej and Jhagadia facility, augmenting its capacity to 7,890 MTPA and 5,760 MTPA, respectively.

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