The Rs 2,160-crore initial public offering of UTI Asset Management Company was subscribed 78.5 per cent on the second day of bidding on Wednesday. The issue closes October 1. UTI AMC IPO received bids for 2.15 crore equity shares against an offer size of 2.73 crore equity shares, according to the exchange data. The company has received Rs 645 crore from anchor investors.
The portion reserved for non institutional investors was subscribed 34.7 per cent and for retail individual investors (RIIs) 1.15 times. The quota for employees was subscribed by 66.5 per cent and that of qualified institutional buyers 47.82 percent.
State Bank of India (SBI), Life Insurance Corporation (LIC), and Bank of Baroda are offering to sell 1,04,59,949 shares each, while Punjab National Bank (PNB) and T Rowe Price International are going to offload 38,03,617 shares each.
Price range for the offer has been fixed at Rs 552-554 per share. At the upper end of the price band, the IPO would fetch Rs 2,160 crore. This will be the third AMC to get listed on the stock exchanges after Nippon Life India Asset Management and HDFC AMC.
"At the higher end of the price band, UTI AMC's IPO is priced at a PE ratio of 25.41, based on FY20 earnings. This is at a significant discount to listed peers HDFC AMC (trading at PE of 36) and Nippon Life (PE of 37). Given its relatively weaker profitability and growth ratios, this seems to be justified. UTI AMC operates at higher operating costs versus peers, which has taken a toll on its profitability. We believe that one can subscribe to this IPO purely from the chances of achieving listing gains," INDmoney said.
Kotak Mahindra Capital Company, Axis Capital, Citigroup Global Markets India, DSP Merrill Lynch, ICICI Securities, JM Financial, and SBI Capital Markets are the managers to the offer. Shares of the company are proposed to be listed on BSE and NSE.