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Despite adverse market conditions due to coronavirus, the initial public offering of SBI Cards & Payment Services has received overwhelming response from all category of investors, especially record investments from institutional investors.
On Thursday, the last day of the issue, the IPO got subscribed by 22.45 times overall, according to a data available with the stock exchanges. The public issue of SBI Cards, first credit/debit card company in India to enter capital market, received bids for about ₹1.75-lakh crore as against an offer for about ₹7,800 crore.
Through the IPO, SBI Cards aimed to raise ₹10,340 crore at an issue price of ₹750-755 a share. SBI, the parent firm of SBI Cards, would raise ₹500 crore by selling 0.66 crore shares and Carlyle Group, PE investor, will offer up to 13.05 crore shares to raise ₹9,840 crore. Only ₹500 crore will go to SBI Cards. Ahead of the IPO, the company had raised ₹2,769 crore from 74 anchor investors.
As against a routine norm of three-day public issue, the IPO came out with a four-day window — the last day being exclusively for retail investors, high net worth individuals, employees and shareholders of SBI.
Staff, retail remain keen
While employees and retail investors have been showing keen interest on the issue from Day 1, qualified institutional investors remain quiet on the first two days but entered with big bags on the last day (Wednesday). They have pumped in over ₹1-lakh crore, which none of the other issues were able to generate till now. The portion reserved for QIBs got subscribed by 56.66 times, resulting in subscription of ₹1.04-lakh crore. The previous issues where QIBs shown keen interest were HDFC Asset Management Company — ₹93,000 crore and Avenue Supermarts — ₹55,000 crore.
Following the footsteps of QIBs, even high net worth individuals subscribed the IPO heavily. The portion allocated for them received bids for 43.72 times, or over ₹60,500 crore. Another category that had shown keen interest in the IPO was shareholders of SBI. The portion for shareholders received bids for 25 times. While staff portion got subscribed 4.75 times, retail investors have invested a little over ₹8,000 core.
The stock is expected to be listed on March 18. Link InTime India Pvt Ltd is the registrar to the IPO and will manage the allocation. Allotment is likely to be finalised on March 11.
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