MOIL IPO subscribed 56 times on last day

According to market experts,the issue has benefitted from the success of IPOs and FPOs by other state-run companies,including CIL and PowerGrid. Furthermore,the attractive pricing of the issue helped lure investors.

“The tremendous response to MOIL’s offer was driven by reasonable pricing and the size of the issue,” Geojit BNP Paribas Research Head Alex Matthews said.

Bidding for the IPO closed on Wednesday for Qualified Institutional Buyers (QIBs) and today was the last date for retail and non-institutional investors to subscribe to the issue.

Shares reserved for QIBs under the IPO were subscribed 49.16 times,as per the latest available data. However,data on retail and non-institutional investor participation in the IPO was not immediately available.

“The day the issue opened,the sentiment in the broader market was very weak,but as soon as the offer neared its closing day,along with an improved market condition,investors confidence were lifted by the day. This is the reason the offer received such a stupendous response from the investors,” Unicon Financial Services CEO Gajendra Nagpal said.

The government has fixed the price band of shares proposed to be allotted under the offer at Rs 340-375 apiece.

The Centre will divest a 10 per cent stake in the company through the IPO,while the state governments of Madhya Pradesh and Maharashtra will offload 5 per cent each.

At the upper end of the price band,MOIL’s IPO would be worth nearly Rs 1,260 crore and at the lower end,it would fetch about Rs 1,142 crore.

Going by the kind of demand the issue has garnered,investors can expect to see MOIL make a handsome debut on the bourses,similar to what was seen by Coal India after its recent IPO,an expert said.

Edelweiss Capital,IDBI Capital Market Services and JP Morgan India Private are the book running lead managers to the issue.