Canara Robeco AMC IPO closes with nearly 10x subscription, QIB portion booked 26x: Check latest GMP

Canara Robeco AMC IPO Day 3

The initial public offering of Canara Robeco Asset Management Company closed today after seeing strong investor interest. The Rs 1,326-crore IPO has been subscribed nearly 10 times (974 percent) on October 13.

The maiden public issue of the company received bids for nearly 34 crore shares, as against the offer size of 3.49 crore shares, according to data on NSE. Retail and Non Institutional Investors (NII) subscribed their reserved portions 191 percent and 645 percent respectively.

Qualified Institutional Buyers (QIB) strongly bid for the IPO on the final day, booking their reserved portion a whopping 26 times (2,592 percent).

Canara Robeco AMC IPO GMP:

The grey market estimates remained volatile during the day. After trading flat at the IPO price, the grey market premium (GMP) rose to 3.38 percent, according to data on Investorgain. The GMP quoted by the site has fallen from the 7.5 percent quoted on Day 2, and 13 percent before the IPO opened for public bidding.

As per IPO Watch, the unlisted shares of the company were trading with 3 percent GMP over the IPO price.

Key things to know about Canara Robeco AMC IPO:

Canara Robeco AMC launched its initial public offering to raise Rs 1,326 crore entirely through an offer for sale (OFS) of nearly 5 crore shares, with no fresh issue component. This means that none of the IPO proceeds will go to the company as they will be received by the selling promoters. Currently, Canara Bank owns 51 percent stake in Canara Robeco while Orix Corporation holding has the remaining stake in the AMC.

The company has set a price band of Rs 253-266 apiece for the IPO, which remained open for public bidding between October 9 and October 13. Investors can bid for a minimum of 56 shares, requiring an investment of Rs 14,896, and in multiples thereafter.

The allotments will likely be finalized by October 14, and the shares are scheduled to debut on stock exchanges BSE and NSE on October 16.

Canara Robeco AMC IPO Anchor Book:

A day before the IPO opened for public bidding, Canara Robeco AMC announced that it has raised Rs 397.8 crore from 25 anchor investors on October 8. Domestic mutual funds picked 76.73 percent portion (1.14 crore shares) through their 18 schemes including SBI Mutual Fund, ICICI Prudential MF, Nippon Life India, Kotak Mahindra AMC, Axis MF, DSP MF, Mirae Asset, HSBC, Motilal Oswal AMC, and Franklin India.

Other investors like Pinebridge Global Funds, IIFL Asset Management, Bajaj Allianz Life Insurance, Aditya Birla Sun Life Insurance, Kotak Mahindra Life, and Steinberg India Emerging Opportunities Fund also participated in the anchor book.

Should you apply for Canara Robeco AMC IPO?

Anand Rathi advised investors to subscribe to the issue for the long term. "At the upper price band company is valuing at P/E of 27.8x to its FY25 earnings and market cap of Rs 53,045 million post issue of equity shares. We believe that the IPO is fully priced," it said.

Ajcon Global also advised investors to subscribe to the issue. "At the upper price band of Rs 266, the issue is valued at a P/E multiple of ~27.82x on its FY25 EPS of Rs 9.56 post IPO," it said.

"Canara Robeco Asset Management has been priced attractively, generating a GMP (grey market premium) in the early teens as the premium is modest even at current price. This is due to the competitive space its playing in with larger conglomerates dominating this market," said Shravan Shetty, Managing Director, Primus Partners.

"With a focus on equity-oriented mutual funds and growing reach in smaller cities, the firm has positioned itself for steady long-term growth. Investors should note that consistent performance, improving cost efficiency, and a strong brand presence in the asset management space are likely to support listing momentum. Early market signals and positive sentiment around the IPO indicate potential for a favourable debut, reflecting optimism about its ability to capture market share and expand its investor base," said Kalp Jain, Research Analyst, INVasset PMS.

"The IPO indicates high demand for wealth management channels and provides investors with a chance to benefit from exposure to India's growing financial services universe and capital markets, which are directly associated with mobilising funds for large-scale projects," said Siddharth Maurya, Founder & Managing Director, Vibhavangal Anukulakara.

Follow all IPO news here.

Disclaimer: The views and investment tips expressed by experts on Moneycontrol are their own and not those of the website or its management. Moneycontrol advises users to check with certified experts before taking any investment decisions.