Sapphire Foods Limited which had tapped the capital markets with its offer for sale of 1,75,69,941 equity shares in a price band of Rs 1,120-1,180 was subscribed 6.45 times overall. Earlier the company had completed allocation to anchor investors. The issue had opened on Tuesday the 9th of November and closed on Thursday the 11th of November.

The QIB portion was subscribed 7.50 times, HNI portion was subscribed 3.46 times and Retail portion was subscribed 7.76 times. There were 9.87 lac applications and on basis of lots the retail portion was subscribed 6.75 times. The issue has received muted response and at a time when massive oversubscription is the norm, all buckets were subscribed in single digits.

Competitor and the other franchisee of Yum Foods, who has turned net positive and declared profits for the quarter ended September 2021, saw its share price touch a new high of Rs 168.40 and close at Rs 160.55. the issue which listed on 16th of August had issued shares at Rs 90.

The company allotted 79,06,473 equity shares to 30 anchor investors comprising of 53 entities at the top end of the price band of Rs 1,180. The highest allocation was made to Fidelity Funds who were allotted 12,71,220 shares or 16.07% of the anchor book. This was followed by Government of Singapore who was allotted 8,56,884 shares or 10.84% of the anchor book. Another associate, Monetary authority of Singapore was allotted 1,77,444 equity shares or 2.24% of the anchor book. This made a total of 10,34,328 shares or 13.08% of the anchor book. This meant that the top two anchors comprising of seven entities were allotted 23,05,548 equity shares or 29.15% of the anchor book.

Domestic mutual funds were allotted 5,00,424 shares or 6.33% of the anchor book. This was to two mutual funds with Sundaram being allotted 4.51% of the anchor book and HDFC being allotted 1.82% of the anchor book. Very clearly it appears that domestic mutual funds who are flush with funds have by and large chosen to give this issue the miss. Was it the valuations which kept them away? Not sure, but the India consumption story is intact and issue after issue is getting received unless valuation stops funds.

In conclusion, investors have turned much smarter than what merchant bankers and Private Equity Investors would expect. In this issue the fact that in under three months, the asking price has increased 2.3 times has not gone down well with institutional investors and the same has reflected even in the public subscription. Hope people who matter understand.

Full details of the subscription are given below: –