The Rs 820-crore initial public offering (IPO) of state-owned RailTel Corporation of India was subscribed 4.9 times on its second day of bidding. The public issue was subscribed 7.69 times by retail investors, 0.01 times in QIB category and 1.26 times in the NII category today.
RailTel, the seventh IPO of 2021, at a price band of Rs 93-94 per share, has hit the primary market just after Rs 100-crore IPO of Nureca, which ends today.
The minimum market lot size for the RailTel IPO is 155 shares, where an individual investor can apply for up to 13 lots (2015 shares or Rs 189,410).
Mini Ratna (Category-1) Railtel's IPO, which will see the Ministry of Railways sell 27% stake post the issue, was fully subscribed on the very first day of the issue. Market experts have suggested Rs 30-40 listing gains for short-term perspective in RailTel Corporation. RailTel IPO listing date is 26th February 2021.
As per the company's DRHP, the net proceeds from RailTel Corporation of India's Rs 819.24-crore initial public offer are to be used for carrying out the disinvestment plan and to achieve the benefits of equity share listing on the stock exchanges. The company will not receive any proceeds from the offer.
Reliance Securities, SMC Global, IIFL Wealth, TopShareBrokers.com, BP Wealth, Choice Equity Broking and Angel Broking have kept the positive outlook for the IPO, with 'Subscribe' rating. On the other hand, Kotak Securities, ICICI Direct and Axis Capital assigned 'None' rating to the IPO. At the higher price band of Rs. 94 per share, the IPO is valued at 21.4x EPS and 8.9x EBITDA for FY20.
Meanwhile, Healthcare and wellness products distributor Nucera's issue got subscribed 21 times on its third and last day of subscription. The Nureca limited public issue was subscribed 113.06 times by retail investors, 0.67 times in QIB category and 2.69 times in the NII category. The IPO was already oversubscribed on day one. Most analysts have recommended a buy on the IPO.
The price band of the IPO is fixed at Rs 396-400 per share. Investors can bid for a minimum of 35 equity shares and in multiples of 35 shares thereafter and up to 14 lots.
As per Nucera's red herring prospectus, the company plans to utilise issue proceeds for funding incremental working capital requirements and general corporate purposes.
Reliance Securities, Angel Broking, GEPL Capital have rated 'Subscribe' to the IPO, whereas TopShareBrokers.com and BP Wealth recommended avoiding the IPO. SMC Global gave 2 out of 5 stars to the IPO.