The initial public offering of Corona Remedies got oversubscribed on its second day of public bidding, December 9. The maiden issue of the pharma company has been booked more than 9 times its offer size on Day 2.
Retail investors have booked their reserved portion more than 6 times, while Non-Institutional Investors (NII) have subscribed their allotted quota around 27 times. Qualified Institutional Buyers (QIB) have booked their reserved portion nearly 2 times.
Ahead of listing, the unlisted shares of Corona Remedies were trading with over 27 percent grey market premium over the IPO price, according to data on IPO Watch.
Corona Remedies launched its IPO to raise more than Rs 655 crore through an entirely offer for sale (OFS) of shares with no fresh issue component. This means that all of the IPO proceeds will go the selling investors and not the company.
The price band for the IPO has been set at Rs 1,008-1,062 per share. Investors can bid for a minimum of 14 shares, requiring an investment of Rs 14,868 per lot, and in multiples thereafter. The IPO will remain open for public bidding between December 8 and December 10. The allotments are likely to be finalized by December 11, and the shares are scheduled to be listed on stock exchanges BSE and NSE on December 15.
Corona Remedies IPO is entirely an offer-for-sale, which means that the market will look at the issue solely from a fundamental perspective, that is how strong the margins are, how deep the product portfolio is, and how consistent the growth is, said Siddharth Maurya, Founder & Managing Director, Vibhavangal Anukulakara Pvt. Ltd.
"The company boasts a decent presence in the leading therapeutic areas, however, its profit figures are lower than those of some of its competitors," the analyst said. He added that investors should position this offering as one in the pharma sector that will generate steady returns over time instead of that which can bring quick profits.
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