Madhusudan Masala IPO turned out to be a great success for the promoters, getting an overwhelming response from investors as the offer was subscribed 412.94 times on September 21, the last day of bidding. The issue received bids for 100.51 crore shares against the issue size of 24.34 lakh shares.
Retail investors and high networth individuals (non-institutional investors) remained at the forefront to boost the issue subscription, subscribing 592.8 times and 576.6 times their allotted quota, respectively, while qualified institutional buyers (QIBs) have bought 86.64 times the portion set aside for them.
The initial public offering (IPO) of 34,00,000 lakh shares comprised only a fresh issue portion taking the fundraising to Rs 23.80 crore at the upper price band. The Gujarat-based spices maker has reserved 1,72,000 equity shares from the offering for the market maker and the remaining shares come under the net issue basket.
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Of the total net issue (32,28,000 shares), 50 percent (16,14,000 shares) were reserved for qualified institutional buyers (QIBs), 35 percent of the net offer was reserved for retail investors (11,29,800 shares) and 15 percent (4,84,200 shares) for high networth individuals (HNIs).
The price band for the offer, which was opened on September 18, was Rs 66-70 per share.
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The company manufactures more than 32 types of spices under the brand names of DOUBLE HATHI and MAHARAJA will be using net fresh issue proceeds mainly for working capital requirements and general corporate purpose. It also sells products like whole spices, tea and other grocery products.
Madhusudan Masala will make its debut on the NSE Emerge with effect from October 3, as per the IPO schedule.
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Its shares were available at around double the price, i.e. 97 percent premium over the upper price band of Rs 70 per share in the grey market, analysts said on anonymity. The grey market is an unofficial platform for IPO shares which can be bought and sold till the listing.
This was the second spices company IPO getting huge response from investors in the SME segment after Srivari Spices and Foods which was also subscribed 418.5 times in last month.
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