The public issue of Repco Home Finance has struggled to evoke a good investor response so far.
The IPO, which closes on Friday (today), has received bids for 2.98 lakh shares only as against an offer of 1.34 crore shares.
Promoted by Government of India enterprise Repco Bank Ltd, Repco Home Finance plans to raise about Rs 270 crore through the issue. It fixed a price band of Rs 165-172 a share by issuing 1.57 crore equity shares at a face value of Rs 10.
Earlier, the professionally managed housing finance company had allocated 23.31 lakh shares to anchor investors at Rs 172 a share, raising about Rs 40.1 crore.
The anchor investors include Goldman Sachs, Birla Sun Life, Reliance Capital, Nomura India Investment Fund Mother Fund, Citigroup Global Markets Mauritius, Sundaram Mutual Fund, ICICI Prudential Banking and Financial Services Fund and Franklin Templeton Mutual Fund.
The IPO of the National Housing Bank-registered company includes reservation of 1.8 lakh shares for subscription by eligible employees at the issue price. The company has decided to offer a discount of Rs 16 on the issue price to eligible employees.
The company, which is mainly present in South India, said it would continue to focus on under-penetrated markets in Tier-II and Tier-III cities and on the non-salaried class. At present, the company is engaged in providing individual housing loans and loans against property.
The promoter, Repco Bank, currently holds 50 per cent share, which will come down to 37.4 per cent post-issue .
The company will use the proceeds to meet its capital requirement. Currently, it has as a capital adequacy ratio of 15.9 per cent, well above the NHB requirement of 12 per cent.