CarTrade IPO sees 20x demand; Nuvoco issue sails through

Mumbai: The initial public offerings of CarTrade Tech and Nuvoco Vistas Corporation managed to sail through as investors took the recent turmoil in mid- and small-cap shares and the increase in funding costs in their stride. Investor appetite for CarTrade remained strong with the issue getting subscribed 20 times, while bids for Nuvoco was relatively modest compared to the recent offerings on account of lack of demand from retail and rich investors. Both issues closed on Wednesday.

The Rs 5,000-crore IPO of Nuvoco, owned by the Nirma Group, was subscribed 1.7 times. It received bids for 10.70 crore shares against the 6.25 crore shares on offer. The qualified institutional buyer category was subscribed 4.23 times, while the non-institutional investor category was subscribed 0.66 times. The portion reserved for retail investors was undersubscribed 0.73 times. This is the first in the last 15 IPOs where the retail portion was undersubscribed.

Nuvoco’s offering comprised fresh issue of shares worth Rs 1,500 crore and an offer for sale of Rs 3,500 crore by existing shareholders. On Saturday, the company raised Rs 1,500 crore by allotting 30 per cent of the issue to 40 investors.

The Rs 3,000-crore public issue of CarTrade Tech, a multi-channel auto platform provider, received bids for 26.31 crore shares against 1.29 crore shares on offer. The portion reserved for qualified institutional buyers was subscribed 35.45 times, while shares set aside for non-institutional investors were subscribed 41 times. The retail portion was subscribed 2.75 times. CarTrade has raised Rs 899.55 crore through a total of 5.6 lakh share sale to anchor investors ahead of the IPO.

Chemplast Sanmar and Aptus Value Housing, the other two IPOs opened for subscription on Tuesday, were subscribed just 26 per cent and 37 per cent, respectively, till Wednesday.

With the spate of recent issues resulting in money getting locked up and funded bets made on the last two offerings resulting in losses, market participants expect demand for IPOs to moderate. Last week, four IPOs generated a total demand of Rs 1.71 lakh crore against the shares worth Rs 2,327 crore on offer, excluding anchor allotments. Retail investors pumped nearly Rs 18,150 crore into these IPOs. These funds are likely to be released only on Thursday.