Shalby Limited -Issue subscribed 2.82 times

Shalby Limited the super speciality hospital chain founded by Dr Vikram Shah was subscribed 2.82 times. The company had tapped the capital markets with its simultaneous issue to raise fresh equity of Rs 480 crs and an offer for sale of 10 lakh shares in a price band of Rs 245-248. The company had earlier allotted 60,70,150 equity shares to 11 anchor investors comprising of 13 entities. The highest allocation was done to Goldman Sachs who was allotted 9,67,740 shares which was 15.94% of the equity issue.

The issue received decent support and was subscribed 4.34 times by QIB’s. The HNI portion received lukewarm response and was undersubscribed at 0.42 times. The retail bucket was subscribed 2.98 times. A total of 3.19 lakh applications were received which made the issue in terms of applications subscribed 2.82 times.

The reason for the poor response from HNI’s was apparent as there was no way the HNI portion of the issue would be subscribed some 50-60 times or over. If that did not happen the margin on borrowing would not be the one or two percent but a hefty five or ten percent. No HNI wants to write a cheque of 25-50 crs for a 500 cr issue and hence there was no funding in the issue. This is despite the fact that the merchant bankers to the issue have their own NBFC’s and have lent money to the system. So much so that of the three merchant bankers, two are those with a large funding book.

This makes one conclude that the fundamentals of the issue are not enough for the leveraged HNI to subscribe. The greatest attraction for him is whether the same can be subscribed in triple digit and therefore get funded at margins of one percent or lower. It’s time the regulator takes a close look at the way funding happens.

Details of the subscription under various buckets is given below: –

Bucket Size Shares applied for Times oversubscribed
QIB 4165267 18093000 4.34
HNI 3070626 1299060 0.42
Retail 7164793 21326760 2.98
Employee Reservation 121000 174180 1.44
Total 14521686 40893000 2.82

Future Supply Chain Solutions Limited – Completes Anchor Allocation

Future Supply Chain Solutions Limited which is tapping the capital markets with its offer for sale of 97,84,570 equity shares in a price band of Rs 660-664 completed allocation to anchor investors. The company allotted 29,35,370 equity shares to 13 anchor investors comprising of 16 entities. Five anchor investors were allotted an identical 3,46,236 equity shares or 11.80% of the anchor book. The allotment was made at Rs 664 which is the top end of the band.

The issue opens today i.e. Wednesday the 6th of December and closes on Friday the 8th of December.

The allotment is heavily skewed in favour of domestic funds who have been seeing a huge inflow from retail investors. Comparatively FPI’s have not shown as much interest in this company.

The detailed list of anchor investors and their allotment is given below: –

future-supply-chain-anchor-letter

Shalby Limited -Completes Anchor Allocation

Date: December 4, 2017

Shalby Limited which is tapping the capital markets with its simultaneous offer completed allocation to anchor investors. The company allotted 60,70,150 equity shares to 11 anchor investors comprising of 13 entities. The highest allocation was done to Goldman Sachs who was allotted 9,67,740 shares which was 15.94% of the equity issue. The issue comprises of a fresh issue to raise Rs 480 crs and an offer for sale of 10 lakh shares. The price band is Rs 245-248. The issue opens today i.e. Tuesday the 5th of December and closes on Thursday the 7th of December.

The company runs a chain of super speciality hospitals and is founded by the orthopaedic surgeon well known for knee replacements from Ahmedabad, Dr Vikram Shah.

The full list of anchor investors with their allotment is given below: –

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