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Home >Markets >Ipo >Zomato IPO fully subscribed on day 1; retail portion oversubscribed 2.69 times

The much-awaited initial public offering (IPO) of the home-grown food tech unicorn Zomato is finally here as the three-day share sale opened for subscription today with the offer price for the IPO fixed at 72- 76 per share.

Zomato's IPO got fully subscribed on the first day of bidding, led by a good response from the retail investors. Overall, the issue got subscribed nearly 1.05 times on Day 1, data compiled by stock exchanges showed. The offer received bids for 75.60 crore equity shares against IPO size of 71.92 crore equity shares.

The 10% retail quota was oversubscribed at 2.69 times. The Qualified Institutional Buyers (QIBs) portion was subscribed 0.98 times (98%) while the portion reserved for non institutional investors got subscribed 0.13 times (13%). The portion set aside for employees was subscribed 0.8 times or 18%.

Zomato on Tuesday said that it has raised 4,196 crore from several prominent institutional investors as part of an anchor book allocation. It has allocated 552.17 million equity shares, to anchor investors, at a price of 76 per share. Government of Singapore, BlackRock, Goldman Sachs, Abu Dhabi Investment Authority are some of the investors that participated in the anchor book.

The issue comprises an offer for sale of 375 crore by the company’s early investor—Info Edge—and a fresh issue worth 9,000 crore. Link Intime India Private is the registrar of Zomato IPO and according to brokerages share allotment is likely to be finalised on July 22 and Zomato shares are likely to be listed on July 27.

Key details -

-Issue period: 14 July 2021 – 16 July 2021

-IPO Size: 9,375 crore

Price band: 72 to 76 per share

Listing: Zomato shares are expected to list on both NSE and BSE on July 27

Bid lot: Minimum lot of 195 shares, and in multiples of 195 thereafter

-Quota size: For retail category, the quota is fixed at 10% of the net offer while for qualified institutional buyers (QIB) at 75% and non-institutional investors (NII) quota at 15%.

-Kotak Mahindra Capital, Morgan Stanley India, and Credit Suisse Securities (India) are the global coordinators and book running lead managers (BRLMs).

-Bank of America (BofA) Securities and Citigroup Global Markets India will manage the issue whereas Link Intime India is the registrar of the issue.

-The company’s consolidated loss narrowed to 816 crore in FY21 as compared to loss of 2,385 crore in the previous year. The company has said that its losses are expected to continue given ‘significant investments towards growing its business.’ As of 31st March 2021, Zomato was present in 525 cities in India, with 389,932 active restaurant listings along with presence in 23 countries outside India.

-Many domestic brokerage firms have given a 'Subscribe' rating to the IPO. Motilal Oswal said that investors with high risk appetite can 'Subscribe for Listing Gains' whereas Choice Broking have assigned a 'Subscribe with Caution' rating.

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