Indo Farm Equipment IPO fully booked on day 1, records 17.71x subscription with demand across categories of investors

Indo Farm Equipment IPO

The initial public offering of Indo Farm Equipment, the tractors and pick & carry crane manufacturer, has received overwhelming response from across categories of investors, closing the first day with a massive 17.71 times subscription on December 31. The public bidding for the issue will remain open till January 2.

The company will finalise the share allotment by January 3, and the trading in Indo Farm shares will commence on the bourses effective January 7.

Investors have applied for 15 crore equity shares on Tuesday, against the offer size of 84.70 lakh shares, the subscription data on the exchanges showed.

Non-institutional investors led the subscription demand, buying 28.57 times their allotted quota, followed by retail investors who were at the second spot with subscribed at 18.55 times their reserved portion. Qualified institutional buyers were also showed strong interest in the issue on day 1, subscribing 8.10 times the part set aside for them.

Indo Farm Equipment IPO shares were available at around 40 percent premium over the upper price band in the grey market (an unofficial market for trading in IPO shares till the listing), the market observers said.

Incorporated in 1994, Indo Farm Equipment targets to raise Rs 260.15 crore through maiden public issue which comprises of fresh issue of 86 lakh shares worth Rs 184.9 crore, and an offer-for-sale of 35 lakh shares worth Rs 75.25 crore at the upper end of price band of Rs 204-215 per share.

Promoter Ranbir Singh Khadwalia is the selling shareholder in the offer-for-sale.

The Chandigarh-based company that also deals in other farm equipment (harvester combines, rotavators and other related spares & components) has already raised Rs 78.05 crore via anchor book on December 30.

It will utilise fresh issue proceeds for the expansion of pick & carry cranes manufacturing capacity, repaying debt, and general corporate purposes. Further, it will also invest some amount (from fresh issue funds) in NBFC subsidiary Barota Finance for financing the augmentation of its capital base to meet future capital requirements.