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Tag: grey market premium

  • Overwhelming Response to Net Avenue Technologies IPO

    Overwhelming Response to Net Avenue Technologies IPO

    Net Avenue Technologies’ initial public offering (IPO), which commenced on November 30, garnered extraordinary investor interest, closing with a subscription rate of over 511.10 times on the last day of bidding. The breakdown reveals a substantial appetite across investor categories, with retail subscriptions at 721.68 times, QIB at 61.99 times, and NII at an impressive 616.24 times, based on data from chittorgarh.com.

     

    The overwhelming response resulted in a staggering 1,93,81,04,000 applications against a modest offering of 37,92,000 shares on the third day of the IPO. This fervent demand was reflected in specific categories, with the retail segment subscribing 89.06 times, QIB at 0.41 times, and NII at 46.17 times by December 1, according to data sourced from Chittorgarh.com.

     

    The journey of Net Avenue Technologies IPO began on a robust note, witnessing a subscription rate of over 14 times on the first day. Noteworthy figures include the retail portion being booked 23.37 times, NII at 10.74 times, and QIB remaining unsubscribed on the initial day.

     

    Breaking down the specifics of the Net Avenue Technologies IPO, it comprises a public issue of 5,696,000 equity shares. The allotment includes 1,896,000 shares for retail investors, 1,080,000 for qualified institutional buyers, and 816,000 for non-institutional investors. The price band has been set at ₹16 to ₹18 per share, with a face value of ₹1 per share. The total issue size stands at 5,696,000 shares, aggregating up to ₹10.25 crore.

     

    The allocation strategy entails not more than 50% of the offer being reserved for QIB, a minimum of 30% for the retail portion, and a minimum of 15% for NII (HNI). Notably, the issue secured ₹2.91 crore from anchor investors on November 29, 2023.

     

    Net Avenue Technologies outlines its intention to utilize the net proceeds from the IPO for various purposes, including funding customer acquisition through marketing and awareness initiatives, addressing working capital requirements, fulfilling general corporate needs, and covering the expenses associated with the issue.

     

    Managing the IPO proceedings, Shreni Shares Limited acts as the book running lead manager, while Bigshare Services Pvt Ltd takes on the role of the registrar for the issue.

     

    In terms of the grey market scenario, the Grey Market Premium (GMP) for Net Avenue IPO currently stands at +11, indicating a premium of ₹11 in the grey market, as reported by investorgain.com. This signifies the willingness of investors to pay more than the issue price for Net Avenue shares.

     

    Taking into consideration the upper end of the IPO price band and the current GMP, the estimated listing price for Net Avenue shares is projected at ₹29 apiece. This reflects a significant 61% increase over the IPO price of ₹18, underscoring the strong investor confidence and anticipation surrounding the listing. The “Grey market premium” serves as a valuable indicator of investors’ readiness to pay a premium for shares, highlighting the optimistic sentiment prevailing in the market.

  • Tata Technologies Raises ₹791 Crore from Anchor Investors

    Tata Technologies Raises ₹791 Crore from Anchor Investors

    Tata Technologies, the engineering services company under the Tata Group, has successfully raised ₹791 crore from 67 investors through an anchor book, just a day before its highly anticipated Initial Public Offering (IPO) opens for bidding. This marks a significant development as it hits the upper limit of the ₹475-500 price range set by the company for the IPO.

     

    In a filing to exchanges, Tata Technologies stated, “the company in consultation with the book running lead managers has finalised allocation of 1,58,21,071 equity shares to anchor investors, at a price of ₹500 per share.” The IPO, scheduled to open on November 22, will remain open for bidding until November 24.

     

    This IPO is particularly noteworthy as it represents the first public offering from a Tata Group company in almost two decades. The company aims to raise ₹3,042.51 crore through this IPO, which is entirely an offer for sale (OFS) in nature. Tata Technologies has reserved 20.28 lakh equity shares for its employees and 60.85 lakh shares for Tata Motors shareholders. The net issue of the IPO, excluding the portions allocated to employees and shareholders, constitutes the overall offering.

     

    Qualified institutional buyers (QIBs) have been allocated 50% of the total offer size, with 15% earmarked for high net worth individuals (HNIs). The remaining 35% is set aside for retail investors, providing a diverse participation opportunity in the IPO.

     

    Market analysts are closely watching the IPO, noting that Tata Technologies shares are trading at a substantial 70% premium in the grey market, which serves as an informal platform for trading IPO shares until their official listing. Despite volatile trends in the market, the grey market premium (GMP) for Tata Technologies IPO remains steady at ₹351, reflecting sustained investor interest.

     

    The IPO allotment date for Tata Technologies is expected on November 27, 2023, while the listing date is anticipated to be on November 29, 2023.

     

    Arihant Capital has given an ‘apply’ recommendation for the public offer. They highlight Tata Technologies’ diverse services, including IT consultancy, SAP implementation, and CAD/CAM engineering and design consultancy. The revenue breakdown shows a robust mix, with approximately 80% from services, 11% from products, and 9% from education.

     

    Strong partnerships with industry leaders like Dassault and Siemens, coupled with the use of Microsoft AZURE products, position Tata Technologies for global expansion. Recent empanelment by Airbus signals significant growth potential for the company. The revenue and profit after tax (PAT) of Tata Technologies have demonstrated a compound annual growth rate (CAGR) of 36% and 62%, respectively, from FY21 to FY23. In the first half of FY24, there was a 34% and 36% year-on-year growth in revenue and PAT.

     

    Arihant Capital suggests that Tata Technologies has outpaced competitors such as Tata Elxsi, L&T Technologies, and KPIT Technologies in revenue CAGR over the last three years. At an upper band valuation of ₹500, the issue is valued at a price-to-earnings (PE) ratio of 32.5x based on FY23 earnings per share (EPS). The recommendation encourages investors to subscribe to the IPO for potential short-term listing gains as well as long-term investment prospects.

  • Netweb Technologies: Strong Subscription of IPO

    Netweb Technologies: Strong Subscription of IPO

    All eyes are now on the allotment date of Netweb Technologies IPO after the closure of bidding for the book build issue. The IPO allotment date is expected to be on 24th July 2023, which falls on Monday next week. During the three days of bidding from 17th to 19th July 2023, the public response to Netweb Technologies IPO was overwhelmingly positive, with the public offer getting subscribed 90.36 times and the retail portion being subscribed 19.15 times.

     

    This strong subscription status has also impacted the grey market, which has turned bullish on the public issue. Currently, shares of Netweb Technologies are available at a premium of ₹380 in the grey market, which is ₹20 higher than the previous day’s grey market premium of ₹360. Market observers attribute this rise in the grey market premium to the overall positive trend in the stock market and the strong response from investors.

     

    The grey market premium of ₹380 indicates that the grey market expects the listing price of Netweb Technologies IPO to be around ₹880 (₹500 + ₹380), which would be approximately 76% higher than the issue price band of ₹475 to ₹500 per share. The book build issue is likely to give more than a 75% listing premium to its allottees on the IPO listing date, which is expected to be on 27th July 2023.

     

    However, experts caution investors against relying too much on the grey market sentiments as the grey market is speculative in nature and is not regulated. They advise investors to carefully analyze the company’s balance sheet to get a more concrete and fundamental picture of the company.

     

    For investors who have applied for the Netweb Technologies IPO, they can check their allotment status online by logging in to the official website of BSE or the website of the official registrar of the IPO, Link Intime India Private Ltd.

     

    The direct link to check Netweb Technologies IPO allotment status are as follows:

    BSE link: bseindia.com/investors/appli_check.aspx

    Link Intime link: linkintime.co.in/mipo/ipoallotment.html