The simultaneous fresh issue to raise Rs 210 crs and an offer for sale of 1.31 cr shares in a price band of Rs 173-180 was oversubscribed. The issue received oversubscription in all categories and it appears that HNI’s went berserk subscribing the issue over 87 times. Even assuming that the margin paid was a low single digit and the rate of interest between 6-6.5%, the cost per share on interest alone comes to Rs 20-22. This cost of interest becomes the safety factor for retail investors who subscribed the issue 2.14 times and on the basis of number of applications about 1.8 times.

Full details of the subscription are as follows: –

Clearly the appetite for the issue was huge and considering the fact that the earlier two issues from the company which owns CCD or Café Coffee Day had seen a tepid response from two of the three categories and Indigo which received a great response on the last day backed by large HNI’s, this company had a very smooth sailing and has done well for itself so far.

The proof of the pudding is in the eating and the performance of the stock post listing would be critical going forward. Incidentally shares of Coffee Day Enterprises Limited would be listing on Monday and it would be an important issue from primary market perspective.