Mrs Bectors Food Specialities reports 2nd highest IPO subscription in last 5 years

Biscuits and bakery products maker Mrs Bectors Food Specialities witnessed the highest subscription among IPOs in 2020 and the second-highest in the last demi-decade.

The Rs 540.54-crore IPO received subscription of 198.02 times during December 15-17, 2020 backed by a strong response from all investors including its employees, though they had a significantly smaller portion compared to others.

We have taken the minimum IPO size of Rs 100 crore for this story and considered the last five years data.

Going by the IPO size of more than Rs 100 crore, Apollo Micro Systems' IPO topped the list with 248.51 times subscription. The electronics components manufacturer raised Rs 156 crore via public issue in 2018.

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Others in the top were Capacite Infraprojects IPO with 183.03 times subscription, Central Depository Services (170.16 times), Ujjivan Small Finance Bank (165.6 times) and Amber Enterprises India (165.4 times).

In 2020 alone, five companies received a strong response to their IPOs, reporting more than 149 times subscription.

Apart from Mrs Bectors Food, state-owned defence company Mazagon Dock Shipbuilders' maiden public offer was subscribed 157.41 times, quick services restaurant chain Burger King India 156.65 times, IT services firm Happiest Minds Technologies 150.98 times and Chemcon Speciality Chemicals 149.3 times.

In fact, the year 2020 was supposed to be a washout year due to COVID-19 crisis as only one IPO - SBI Card was successfully closed before the beginning of lockdown. But in the second half of CY20, 14 companies launched their IPOs successfully largely because of significantly improved market sentiment.

Antony Waste Handling Cell had failed to get any response to its IPO due to weak market sentiment, but the company decided to give a second shot and relaunched IPO which will open December 21-23.

If it gets sailed through, CY 2020 will end with 16 IPOs equalling 2019's tally.

The year ahead (2021) also looks promising as experts expect a lot of companies to come out with IPOs after Rs 30,800 crore of IPOs in 2020.

"I believe the Indian stock market will continue its movement in 2021 and the primary market will also mirror the same story. Looking ahead, continued improvements in global risk appetite and expected improvement in domestic economic activity reflecting a rise in GDP growth will further boost Indian equities to perform well," Prashanth Tapse, AVP Research at Mehta Equities told Moneycontrol.

"IPO pipeline will continue to remain strong as there are quality IPOs line-up and the mood is optimistic over the past 4-6 months, there have been many quality companies hitting the market and also rewarding investors in a big way," he said.