Bandhan Bank IPO subscribed 42% on Day 1

New Delhi, Mar 15: Kolkata-based private sector lender Bandhan Bank’s IPO to raise up to Rs 4,473 crore got subscribed by 42% as at the end of first day of bidding, backed by strong demand from institutional investors. Investors from across the categories bid for a total of 3,49,07,480 shares as against an issue size of 8,34,96,347 shares, implying a subscription of 42%. QIBs registered the highest demand, bidding for a total of 2.99 crore shares as against the issue size of 2.38 crore shares, implying more than 1.2 times subscription. Non-institutional investors registered the least demand, bidding for a paltry 1.66 lakh shares out of 1.78 crore shares reserved for them, implying a subscription of less than 1%. Retail investors bid for a total of 48.51 lakh shares as against 4.17 crore shares reserved for them, implying less than 7% of the shares reserved for the category.
The issue will remain open on Friday as well as Monday, ie, March 16 as well as March 19. Bandhan Bank’s IPO consists of a sale of a total of 11.93 crore shares, which includes a fresh issue of 9.7 crore shares to raise Rs 3,663 crore and an offer for sale of around 2.16 crore shares for Rs 813 crore. Notably, the bank will not receive any proceeds from the offer for sale of Rs 813 crore. According to the company’s prospectus the price band is Rs 370-375. As the minimum lot is 40 shares, investors can bid for 40 equity shares and in multiples of 40 shares thereafter.
Most brokerages say that Bandhan Bank’s IPO is richly priced, and chances of listing gains are low.