It is quite significant that retail investors who have been reacting enthusiastically to almost all IPOs in the market, even from lesser known firms, offered extremely tepid response to the biggest IPO in the Indian market.
Just about half of the shares earmarked for retail investors were subscribed till the evening of October 17, while qualified institutions applied for 6.97 times the shares reserved for them. (Picture Credit: depositphotos)
The biggest IPO in the history of Indian capital markets has drawn to a close. Bids for the Hyundai Motor IPO that set out to mop up a humongous amount of Rs 27,870 crore is coming to a close on October 17. The issue has grabbed the headlines for a number of reasons, but mainly for its abysmally poor GMP (Grey Market Premium) in comparison to the brand image of Hyundai Motor, the size of the issue and the hype it generated on D Street.
Application for equity shares for Hyundai Motor IPO began on October 15. Each share price of the second largest passenger car brand on Indian roads was priced in the band Rs 1,865-1,960.
Hyundai Motor IPO subscription status
In the evening of Thursday, October 17, the overall subscription of Hyundai Motor IPO stood at 2.37 times. Applications for a total of 23,61,90,262 shares were received overall against 9,97,69,810 shares on offer. A disaggregation of the bids between difference categories of investors follows: retail investors 0.50 times, qualified institutions 6.97 times, non-institutional buyers 0.60 times and employees 1.74 times. Till the morning of October 17, the overall applications amounted to only 0.42 times overall.
Hyundai Motor IPO GMP
Data on Hyundai Motor IPO makes interesting reading. In the evening of the last day of bidding, the GMP dropped to Rs 8 indicating a listing gain of 0.41%, considering the share price to be Rs 1,960, at the upper end of the price range. It fell even during the course of the last day of bidding from Rs 17, reflecting continuously eroding poor investor response. According to investorgain, the GMP of the IPO was recorded at Rs 570 on September 27. However, the slide began quickly. But one must remember that GMP is an unofficial estimate which does not guarantee anything.
Hyundai Motor IPO allotment, listing
The date of allotment of Hyundai Motor shares has been fixed on as October 18. Listing will take place in both BSE and NSE on October 22. One of the possible reasons of the poor response from retail investors to this blockbuster issue is concerns about stretched valuations. Also promoters have made no fresh issue of shares but the entire issue is OFS only.
(Disclaimer: This article is only meant to provide information. News9live.com does not recommend buying or selling shares or subscriptions of any IPO and Mutual Funds.)
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