Swajas Air Charters Limited which had tapped the capital markets with its IPO was subscribed. The issue was originally scheduled to remain open between the 26th of September and the 28th of September in a price band of Rs 90-100. The issue remained undersubscribed and was extended to remain open till Wednesday the 5th of October and the revised price band was Rs 84-90. The issue was to raise Rs 37.5 crs.

This was yet another company which chose not to have any road show for its initial public offer as is increasingly becoming a practice with many of these small companies tapping the capital markets. The issue is small and is extremely expensive with the price earnings multiple being asked for a staggering 100. The aviation industry per se is in a bad shape and one is aware of the issues which involve Kingfisher airlines and how even Jet Airways is now struggling. It would indeed be intriguing to know who the QIB investor in the company is who has invested in this company at such high valuations and poor fundamentals.

The issue was overall subscribed 1.72 times and received decent support from QIB’s who subscribed their portion to the extent of 90% while the HNI portion and retail portion was oversubscribed 2.18 and 2.69 times.

The details of the subscription level in various categories are given below: –

This issue will be priced at the top end of the price band at Rs 90 considering that the issue was extended and did not garner adequate support. The role of “friendly” intermediaries in ensuring adequate support in the second edition of the issue is to be appreciated and so also in the QIB’s who have supported this issue.