The offer for sale from HUDCO was oversubscribed 79.53 times. The company had tapped the capital markets with its offer for sale of 20.40 cr shares in a price band of Rs 56-60. Retail and employees were offered a discount of Rs 2 per share. Retail subscription saw a new record with 20.13 lakh applications. This beat the previous best in the issue of Avenue Supermarts the company which runs the D-Mart chain of stores which had received 18.75 lakh subscriptions.

The new applicants are coming from Tier-2 and Tier-3 towns and this trend is also being witnessed in mutual funds where SIP’s have reached a level of 4,200 crs. The other confirmation of this fact is that the total retail subscription was 10.79 times while in terms of applications it was 5.75 times. This number of 10.79 times means that people have applied for more than one lot which would be from first time or nee applicants who are not aware of allotment.

The subscription in the HNI category was 330.36 times and it garnered subscription of almost Rs 60,000 crs. The cost of interest for the leveraged investor assuming 6% interest is Rs 22.78 per share. The share needs to trade above Rs 85 if the HNI is to make even token profit in his application.

This cost of funding would be the comfort factor for the lucky retail investor who gets allotment.