The Honasa Consumer IPO had been subscribed 12 percent on October 31, the first day of bidding, with investors buying 36.07 lakh equity shares against offer size of 2.89 crore shares.
Retail investors have put in bids for 34 percent shares of the portion set aside for them, and high networth individuals (non-institutional investors) have bought 3 percent shares of the reserved portion, while the part reserved for qualified institutional buyers was subscribed 10 percent.
The beauty and personal care brand Mamaearth's parent firm has reserved 75 percent of the net issue size for qualified institutional buyers, 15 percent for high networth individuals and the remaining 10 percent for retail investors.
Its employees, who have Rs 1 crore worth shares reserved in the IPO, have bought 1.97 times the allotted quota. The offer excluding employees share is the net issue.
Also read: Mamaearth IPO opens: Ten things to know before you buy it
Employees will get the reserved shares at a discount of Rs 30 per share to the final issue price. The price band for the offer, which will close on November 2, has been fixed at Rs 308-324 per share.
Varun Alagh and his wife Ghazal Alagh-owned Honasa aims to raise Rs 1,701 crore via maiden public issue that comprises a fresh issuance of shares worth Rs 365 crore by the company, and an offer-for-sale (OFS) of 4.13 crore equity shares by few shareholders including Sofina, Stellaris, Kunal Bahl, Rohit Kumar Bansal, and Shilpa Shetty Kundra.
Of the net fresh issue proceeds, the Gurugram-based direct-to customer company will use Rs 182 crore for its advertisement expenses towards enhancing the awareness and visibility of the brands, and Rs 20.6 crore for setting up new exclusive brand outlets (EBOs).
Also read: Honasa Consumer IPO: Should you subscribe to Mamaearth’s Rs 1,701 crore issue?
Further, it will invest Rs 26 crore in its subsidiary, BBlunt for setting up new salons. And the remaining part of the proceeds will be used for general corporate purposes and unidentified inorganic acquisition.
On October 30, a day before the issue opening, Honasa already mopped up Rs 765.2 crore from several anchor investors including Smallcap World Fund Inc, Fidelity Funds, Abu Dhabi Investment Authority, Government Pension Fund Global, Carmignac Portfolio, Goldman Sachs, ICICI Prudential Mutual Fund, Aditya Birla Sun Life Trustee, Axis Mutual Fund, Whiteoak Capital MF, SBI Life Insurance Company, Aditya Birla Sun Life Insurance Company, and ICICI Prudential Life Insurance Company.
Also read: Mamaearth IPO: Shilpa Shetty looks at 8x returns, Snapdeal co-founders 100x!
But the grey market investors seem to be less interested in the issue as the IPO shares were available at just 2 percent premium over the upper price band, analysts on anonymity said. The grey market is an unofficial platform wherein the IPO shares can be bought and sold till the listing.
Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
