MSTC IPO sails through on last day; sees robust demand from retail investors

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IPO market, REIT, Bullero Capital, equity markets, Stock exchange data, NSE indexNon-institutional investors bid for a total of 13.70 lakh shares as against their issue size of 26.40 lakh shares, implying 52% subscription.

State-run firm which provides auctions and procurement solutions, MSTC IPO sailed through on last day, on robust demand from retail investors. The issue received bids for a total of 1.76 crore out as against a total size of 1.76 crore shares, implying a subscription of about 1.11 times, data from exchanges showed. The retail investor portion registered robust demand a total of 29.80 lakh bids received as against their issue size of 17.60 lakh, implying a subscription of more than 1.63 times the portion reserved for them.

QIBs bid for a total of 1.70 times the portion reserved for them, while NII portion was subscribed 1.70 times their potion . Employees bid for a total of 52,040 shares, as against 70,400 shares reserved for them, implying a subscription of more than 74% of their portion. Notably, MSTC had looked to to raise Rs 226 crore at the upper price band. The Kolkata-based company has fixed the price band for its public offer at Rs 121- Rs 128 per equity share. The issue had opened on 13th March and remained open till today.

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According to the firm’s prospectus, the minimum bid lot is fixed at 90 equity shares and and in multiples of 90 equity shares thereafter. A discount of Rs 5.50 per share on the offer price is being offered to retail individual bidders and eligible employee bidders. At present, the government holds a total 89.85% stake in MSTC. Following the divestment, it’s stake is expected to reduce to 64.85%.

“The company is bringing the issue at p/b multiple of approx 2.63 at higher end of price band of Rs 128/share. Although company is one of the leading PSU entities engaged in providing e-commerce services but loss making financials are acting as a dampener,” HEM Securities said in a report. The research firm has a long-term subscribe on the issue.

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