After bumper demand for IRCTC shares in IPO, all eyes now on allotment1 min read . Updated: 04 Oct 2019, 12:58 PM IST
- IRCTC IPO was subscribed over 112 times
- The retail segment was subscribed nearly 15 times
Despite a volatile stock market, the initial public offering or IPO of IRCTC attracted huge demand among investors. IRCTC IPO, which closed for subscription on Thursday, got subscribed nearly 112 times. Now all eyes are on the allotment, given the bumper demand. As compared to 2.02 crore shares on offer, investors bid for 225 crore shares of IRCTC. The government will hold a 87.4% stake in IRCTC after the IPO.
The registrar of the IRCTC IPO, Alankit Assignments, will take care of share allotment and refund processing. The share allotment of IRCTC IPO is likely to be on 10th October (tentative), according to brokerages. IRCTC shares will get listed on both BSE and NSE and the tentative listing date is 14th October.
The retail segment of IRCTC IPO was subscribed nearly 15 times while Qualified Institutional Buyers (QIBs) segment a massive 108.79 times.
If an issue is oversubscribed, as in case of IRCTC IPO, allotment happens as per predefined rules. In case of an over-subscription, the total number of shares available for retail investors is divided by the minimum lot size. This determines the maximum number of applicants who will receive allotment. If the number of applicants are more than this, a lottery is held.
The lot size of IRCTC IPO was 40 and the price band for retail investors at ₹305-310 per share (including discount for retail investors).
The bumper demand for IRCTC shares have been attributed to its monopolistic nature of business, attractive valuation of the offer and good dividend pay-out track record of the company. The recent corporate tax cut and restoration of service charges on ticket bookings also enthused investors.
IRCTC is authorised by Railways to offer train tickets online, offer catering service and exclusively manufacture and supply packaged drinking water at railway stations and on trains in India. (With Agency Inputs)