4 IPOs to Land the D-Street this Week: What should you expect
Initial Public Offering(IPO) is the initial auction of shares to the public by private firms. The companies are going public to increase funds through IPO for working capital, debt repayment, acquisitions, and a host of other uses.
The investor can apply for IPO Stocks by filling an online IPO application offered by the stockbrokers and banks in India. Brokers offer UPI-based online IPO applications, and banks provide both UPI and ASBA IPO applications.
A stock exchange displays IPO shares that are proposed to be listed. Primary IPO's are listed on BSE and NSE. The SME IPO's are listed on the NSE EMERGE or BSE SME platform of the respective exchanges.
India's primary markets have witnessed an outburst of IPO's in the year 2021, with ten companies listing on the bourses. So far, in 2021. It's a jackpot week for investors as four mainboard companies hit the Street with initial public offerings (IPOs).
However, the primary market is busy again with four public investments Sona Comstar, Shyam Metalics, Dodla Dairy, and KIMS Hospitals, for subscription this week. All four IPOs are very richly valued. As a result, most investors have been collecting to IPO's, assuming substantial listing gains. Nevertheless, investors should allocate carefully, as there is little left for investors given the issue prices.
Global automotive technology company "Sona Comstar" is anticipated to finalize the IPO share allotment next week. Rs 5,550 crore public issue was opened for subscription on Jun 14 and closed on Jun 16 after being subscribed 2.28 times. The retained portion for qualified institutional buyers (QIBs) was subscribed 3.46 times and that of non-institutional investors 39 percent. The part set aside for retail investors seen a subscription of 1.57 times.
Sona Comstar effectively raised Rs 5,550 crore over its public issue, including Rs 2,498 crore from anchor investors. In addition, the offer contained a new point of Rs 300 crore and an offer for sale of Rs 5,250 crore by Singapore VII Topco III Pte. Ltd, an affiliate of The Blackstone Group. The Blackstone-backed technology and innovation-driven company will finalize the IPO share allotment around Jun 21, as per the schedule available in the prospectus.
Sona Comstar obtains 75 percent of business from foreign markets. It is among the top 10 automotive component manufacturers and supplies products across the countries such as India, the US, Europe, and China, with thrust on the electric vehicle segment. It has nine manufacturing and assembly facilities across India, China, Mexico, and the US, of which six are located in India.
The company has been supplying different gears and assemblies in the global electric vehicle market since 2016 and 2018 and has gathered 5 percent and 8.7 percent market share, respectively, as of CY20. At present, these two products contribute 46 percent of its income, while the balance 51 percent comes from starter motors, both Hybrid and conventional.
Shyam Metalics is a leading metal producing company founded in India, focusing on Long Steel Products and Ferro Alloys. It opened its Rs 909-crore public issue on Jun 14, comprising a fresh point of Rs 657 crore and an offer for sale of Rs 252 crore by the existing shareholders.
The public offer of Shyam Metalics and Energy has obtained a subscription of 121.43 times on the final day of bidding, Jun 16, as investors put in bids for over 256.11 crore equity shares against an offer size of 2.1 crore equity shares.
The share set aside for capable institutional buyers has been subscribed 155.71 times, and that of non-institutional stockholders has been booked 340 times so far. The reserved share of retail investors witnessed a subscription of 11.64 times and that of employees 1.55 times, which showed the subscription data obtainable on exchanges led.
Dodla Dairy is an integrated dairy in South India involved in the procurement, processing, distribution, and marketing of milk and other dairy products. It processes and vends milk consist of standardized, toned, and double toned milk and manufactures dairy products like curd, butter, ghee, ice cream, flavored milk, etc.
Dodla Dairy's operations are mainly assumed under the brand name "Dodla." However, it serves overseas markets under the brand name of "Dodla Dairy," "Dairy Top," and "Dodla+." Telangana, Andhra Pradesh, Karnataka, Tamil Nadu, and Maharashtra are the vital Indian market segments served by the company. While, in the overseas market, it mainly serves countries like Uganda and Kenya.
It holds13 processing plants to process raw material into packaged milk and production dairy-based value-added products. The business has a strong circulation network of 40 sales offices, 3336 distribution agents, 863 milk distributors, and 449 product distributors across 11 states in India.
Dodla Dairy IPO is subscribed 3.30x times on Jun 17. The public issue subscribed to 6.18x in the trade category, 0.28x in the QIB category, and 0.60x in the NII category. The Dodla Dairy IPO is being sold in the Rs 421-428 price band. This issue demands a post-issue annualized FY21 PE of 16.4 times at the higher end of this price band.
Krishna Institute of Medical Sciences is a healthcare chain based in Andhra Pradesh and Telangana, India. Now, the KIMS Group operates nine hospitals across the states of Andhra Pradesh and Telangana.
Krishna Institute of Medical Sciences IPO subscribed to 51 percent. Investors put in bids for over 73.93 lakh equity shares against the proposed size of 1.44 crore shares. The problem was with the price band of Rs 815-825 per share.
The reserved share for retail investors was subscribed the utmost 1.81 times, while the portion for qualified institutional buyers (QIBs) was subscribed 30 percent. Non-institutional investors submitted bids for 8 percent of their reserved price, and the employee's shares saw 46 percent subscription. The company has reserved shares worth Rs 20 crore for its employees.
The IPO comprises 1.44 crore shares and an offer for sale of 2.35 crore equity shares. The total issue size comes to Rs 2,143.7 crore. The 75 percent of issue size has been reserved for qualified institutional buyers, 10 percent for retail, and 15 percent for non-institutional investors.