Shares of Indian Energy Exchange listed on a weak note on the bourses today. The stock fell 9 percent to Rs 1,500 against its issue price of Rs 1650 on the BSE and NSE.
However, the stock staged some recovery later, trading just 0.65 per cent lower to its issue price.
At 10:58 am, the stock was trading 9.13 percent higher compared with its open price of 1500 level.
The IPO of the power trading exchange regulated by Central Electricity Regulatory Commission elicited good response from investors, with the issue getting oversubscribed 2.23 times on the last day of bidding on October 11.
Through the IPO, also the first by a power exchange in the country, the company aims to raise up to Rs 1,001 crore. On the final day, the offer received total bids for 11,776,518 shares against 52,75,889 shares on offer, data available with the NSE till 1900 hours showed.
The price band for the offer is Rs 1,645-1,650 per share. In a rare development, the company revised the quantum of share allocation to anchor investors on account of regulations related to Foreign Portfolio Investors (FPIs).
The company's IPO committee of the Board of Directors in consultation with the book running lead managers to the offer has finalised revised allocation of 7,89,120 shares to anchor investors at a price of Rs 1,650 per share, the notice said.
Earlier, the company had alloted 18,19,501 equity shares to anchor investors at the same price. Under regulations, FPIs are not permitted to invest in power exchanges through the primary market route.
"Post receipt of bids from anchor investors in the IEX offer, certain custodians have communicated to the BRLMs (book running lead managers) that FPIs shall not be eligible to participate.
"The company and the BRLMs discussed this development with the regulator in order to identify potential solutions. However, as this has arisen late in the day and during the offer period, an appropriate solution could not be implemented in the short time span available," IEX spokesperson said.
Accordingly, the additional shares, which were earlier to be allotted to FPI anchor investors are available for allocation in the QIB (qualified institutional buyer) portion.
"The company would like to reiterate that this development is arising out of regulatory concerns raised by the custodians rather than any pricing concern. The anchor book, which is available in the public domain, identifies the calibre of investors who were interested in participating in the offer and shows their confidence in the company," the spokesperson said.
The company, along with the BRLMs, has decided to focus on domestic investors in order to avoid any changes to the offer timetable and achieve listing as anticipated, the spokesperson added. The IPO is of up to 60,65,009 shares (including anchor portion of 7,89,120 shares). Axis Capital, Kotak Mahindra Capital Company and IIFL Holdings are managing the company's public issue.