Business & Marketing

RailTel IPO fully subscribed, enters day two; Nureca’s public issue closes for subscription today

IPO Watch: Railtel’s IPO was fully subscribed on the very first day of the issue.

IPOs (initial public offerings) have again picked up pace on Dalal Street. Brookfield REIT made its trading debut this week, while the ongoing Nureca and RailTel’s public issue have been fully subscribed. Nureca’s IPO closes for subscription today while RailTel’s IPO, entering the second day of bidding, has already been oversubscribed by investors. But that might not be the end of IPOs as agro-chem firm Heranba Industries has already announced the launch of its public issue, set for next week.

RailTel fully subscribed

Railtel’s IPO was fully subscribed on the very first day of the issue. RailTel, a Ministry of Railway company, is the second IPO coming from the ministry this year. Retail Investors have bid for 5.13 times their portion of the issue, while employees of the company have subscribed 82% of their quota. NIIs have bid for 80% of their portion while QIBs have steered clear so far. 

The Rs 819 crore issue will see the Ministry sell 27% stake in the company. “Considering FY 20 adjusted EPS of 4.4, the upper price band implies a P/E ratio of 21.36X,” said Marwadi Financial Services in a note. The brokerage firm has a subscribe rating on the issue. RailTel is a Mini Ratna (Category-1), which means it has made profits for the past three years consecutively. IRFC, the other Ministry of Railway firm to be listed this year has so far traded flat over its issue price.

Nureca IPO closes today

Currently, the Rs 100 crore issue of Nureca Ltd has been subscribed 15.34 times by investors. Leading the pack are retail investors who have bid for 83.46 times the quota reserved for them. Employees of the business to consumer firm have oversubscribed their portion 1.56 times. Meanwhile, Non-Institutional Investors (NII) have bid for 1.52 times their portion. Bids by Qualified Institutional Buyers (QIB) remain non-existent so far, however, they could still ramp up their bids later today.

Nureca’s IPO is completely a fresh issue of equity shares. Post the IPO, promoter shareholding in the firm is expected to go from 93.33% to 70% while that of public shareholders is expected to surge to 30% from the current 6.67%. A B2C company engaged in the marketing of home healthcare & wellness products, Nureca has no peers currently trading on the stock exchanges. Working in the healthcare industry, Nureca offers tools to customers to monitor chronic ailments and other diseases, to improve their lifestyle.

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