Mindspace Business Parks Reit had a great day on listing and gained 10.5%. The company had tapped the capital markets with its fresh issue for Rs 1,000 crs and an offer for sale of Rs 3,500 crs and received excellent response and being subscribed 13 times. Earlier the company had allotted to 54 investors a total of 552.27 lac units for a total of 1,518.75 crs by way of anchor allotment. The highest allocation was made to Government of Singapore who was allotted 66,75,200 units worth Rs 183.57 crs. This formed 12.09% of the anchor allocation. The price band was Rs 274-275.

This being an issue under REIT there was a strategic investor quota of Rs 1,125 crs which was earlier allotted. The original issue size of the Rs 4,500 crs was reduced to Rs 1,576.25 crs. This part of the issue was divided into institution and non-institution with no distinction for retail and HNI. The issue was subscribed 13 times with QIB portion subscribed 10.61 times and Non-institution portion subscribed 15.83 times. There were 51,749 applications which makes the average ticket size Rs 25.81 lacs.

The price discovery saw a price of Rs 302 on both the exchanges. The volume traded at this price on price discovery was 5.22 lacs on BSE and 57.86 lacs on NSE, making a total of 63.09 lac shares. The unit made a high of Rs 308.90 on BSE and Rs 307.20 on NSE. The low was Rs 299 on BSE and Rs 300 on NSE. The closing price was Rs 303.87 on BSE, a gain of Rs 28.87 or 10.50%. On NSE. The closing price was Rs 303, a gain of Rs 28 or 10.18%.

The traded volume on the two exchanges combined was 288.59 lac units which was 0.17 times the IPO size. If one were to consider the non-strategic investor and non-anchor investor, this would be 0.43 times the size. The delivery volume was 252.25 lacs which was 87.41% of the traded volume. It was 0.17% of the issue size and 37.24% of the non-strategic investor and non -anchor investors. If one were to compare with the year ago issue of REIT from Embassy office park this issue has seen significantly higher volumes, higher delivery volumes and more significantly higher gains on listing day. The weighted average of the day’s trade was Rs 303.73 on BSE and Rs 302.81 on NSE.

In the case of Embassy office Reits, the company saw a volume of 31.82 lacs which was 2.01% of the IPO size. The delivery volume was 27,49,200 units which was 86.40% of the traded volume and 1.74% of the IPO size. If one were to consider the non-anchor and non-strategic investor portion, the traded volume was 4.48% of the IPO size and delivery volume was 3.87%. Comparing it with today’s issue of Mindspace, the numbers are not comparable whatsoever. Trading was significantly higher and so was delivery. It is clearly borne out that the instrument is being better understood now.

There were two buyers on day one on the NSE as per date. Nomura Investment bought 62,63,200 units at Rs 302.45 while Capital Income builder bought 51,81,400 units at Rs 303.44. These purchases were quite similar to the weighted average and indicates the interest on day one. Going forward the trading volumes would fall and so also the delivery volumes. The sae would pick up when corporate action in the form of dividend is to be announced.

When the concept of INVITS and the REITS were introduced the ticket size for minimum application was Rs 10 lacs which has been reduced in a phased manner to Rs 50,000 now, with a understanding that could become a retail product and means of investment going forward. Keeping this in mind there were as many as 30,061 applicants in the one, two and three lot category of the total 49,989 valid applications. This effectively means that 60% of the issue by number of applications were subscribed in the notional category by retail investors as the lot size in this issue was Rs 55,000. In the proportionate allotment method followed, these applicants numbering 30,000, there were just 2,000 successful applicants and they got 200 units each. If the idea is to encourage investment from retail investors there must be a separate bucket for them ot the allotment must first be for one lot and then proportionate. It is unfair that retail investors are at the receiving end of the allotment.