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SIS IPO subscribed 6.9 times on final day

LiveMint logoLiveMint 02-08-2017 Sneh Susmit

Mumbai: The initial public offering (IPO) of Security and Intelligence Services (India) Ltd (SIS) on Wednesday, the last day of the IPO, witnessed subscription of 6.91 times, according to data from stock exchanges.

As of 6pm, the portion of shares reserved for institutional investors was subscribed 5.64 times, while the portions reserved for high net-worth individuals and retail investors were subscribed 1.66 and 18.64 times, respectively.

SIS had priced its shares in a band of Rs805-815. The IPO is a fresh issue of 5.12 million shares, which at the upper end of the price band will fetch Rs360 crore to the company. SIS promoters Ravindra Kishore Sinha and Rituraj Kishore Sinha, and domestic private equity investor CX Partners are selling part of their stake in the IPO, through an offer for sale.

At the upper end of the price band, these shareholders are collectively selling shares worth Rs417 crore. CX Partners invested Rs500 crore in SIS in 2012.

The proceeds from the fresh issue will be used largely to repay high-cost debt and for investments in technology.

SIS, established in 1974, offers security services, electronic security systems, consulting, facility management, cash services which include transfer of cash and valuables, ATM replenishment, and recruitment and training services.

Also on Wednesday, the initial share sale of state-run shipbuilder Cochin Shipyard Ltd saw a subscription of 3.16 times on the second day of its public offering.

As of 5 pm, the portion of shares reserved for institutional investors was subscribed 3.41 times, while the portions reserved for high net-worth individuals and retail investors saw 82% and 4 times subscriptions, respectively.

The company has set a price band of Rs424-432 per share for the initial share sale. The offer closes on 3 August.

The IPO is a fresh issue of 22.65 million shares, which at the upper end of the price band will fetch the company over Rs978 crore. The issue is also an offer for sale of 11.3 million shares. At the upper end of the price band, the government will raise over Rs489 crore from the stake sale. The government is selling a 10% stake.

The funds will be used to fund two major projects and also to improve the existing facilities.

So far in 2017, the Indian primary market has witnessed 15 initial public offerings that have seen companies raised Rs12,584 crore, according to data from primary market tracker Prime Database. Some of the IPOs this calendar year include Central Depository Services (India) Ltd that was subscribed 169.45 times and AU Small Finance Bank that was subscribed 53.60 times.

In 2016, the Indian primary market saw 26 companies raise Rs26,493.8 crore through the IPO route, data shows.

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