Tamilnad Mercantile Bank on Thursday made a muted debut, with the shares opening at a discount of 3 per cent at ₹495 against the issue price of ₹510 on the NSE. On the BSE, they got listed ₹510.

The shares are currently ruling about 4 per cent lower at ₹490 on the bourses. The initial public offering of Tamilnad Mercantile Bank was subscribed 2.86 times.

"The precarious legal challenges, the lack of complete clarity on the management’s long-term performance, and less than stellar subscription numbers are some of the reasons for its negative listing," said Santosh Meena, Head of Research, Swastika Investmart Ltd.

Price band

Earlier, the ₹863-crore public issue was subscribed 2.86 times. The company, which came out with a price band of ₹500-525 a share, fixed the IPO price at ₹510.

While the portion for retail individual investors (RIIs) was subscribed 6.48 times, non-institutional investors and QIBs quota received bids 2.94 times and 1.68 times.

Anchor investors

Ahead of the IPO, the Thoothukudi-based private sector lender had raised ₹363.53 crore from anchor investors, largely insurance companies. Among the marquee investors included Bajaj Allianz Life Insurance, Nomura Singapore, Max Life Insurance (for various schemes), Societe Generale, Kotak Mahindra Life Insurance, Cholamandalam MS General Insurance, Authum Investment, and Alchemie Ventures Fund are some of the anchor investors.

The Bank proposes to utilise the proceeds to augment its core capital.

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