Mumbai: The initial public offering (IPO) of Anand Rathi Wealth Ltd, the wealth management arm of Anand Rathi Financial Services, got fully subscribed on Thursday, the first day of bidding. The issue will close on 6th December.
The overall book was subscribed 1.60 times, excluding anchor allocation. Till 5 pm, retail investors who cannot invest more than 2 lakh in an IPO, bidding for 2.45 times the shares reserved for him.
The non-institutional category, which includes high net worth individuals, attracted 1.93 times the shares reserved for the category. As per the data available with the stock exchanges, the institutional investor share was subscribed only 0.01 times.
The IPO is valued at 51 times FY11 earnings and 9.5 times FY2011 book value, at a significant premium to its listed counterpart IIFL Wealth Management.
“Keeping in view the superior AUM book (2x of IIFL Wealth), earnings yield and return ratio, we believe that the premium valuation is reasonable and the IPO is reasonably priced. However, limited gains can be expected here from a medium-term perspective, as incremental price accretion may be possible only with the stability of strong performance in the coming quarters,” Reliance Research said in a note to its investors.
Meanwhile, Kolkata-based Tega Industries Ltd’s IPO continued to receive strong response on the second day of bidding, with the overall book, excluding anchor allocation, subscribed 13.87 times as of 5 pm.
Retail investors bid for 17.04 times the shares reserved for them. Non-institutional investors bid for 20.48 times their quota, while institutional investors bid for 3.35 times.
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