Zomato is one of the biggest startups to emerge from India, and thus, when news of its Initial Public Offering broke out, Indians, who have recently been taking quite a bit of interest in the investing world, were stoked. Moreover, when it came out that the IPO size had been reduced due to anchor investors investing over $500Mn in the company, it acted like gasoline, and made this fire blow up. Thus, it is no surprise that the IPO is going quite successfully, and that 36% of the allotted shares were subscribed in early hours of trading of the opening day.
By the end of the first day of trading, 104% of the allotted shares have been subscribed. It should be noted that Zomato’s IPO opened up with an issue size of 71,92,33,522 shares. In comparison, the issue had attracted bids for 74,79,51,360 shares by the end of the first day of trading, which means that the company has managed to exceed its quota on the very first day of the 3 day long IPO.
Thus, needless to say, the IPO looks to be going pretty smoothly for the food delivery platform. Zomato IPO received bids for 2.70 times issue size in retail, 0.98 times issue size in QIB, and 0.13 times issue size in the Non-institutional category by Jul 14, 2021 17:00.
Investor have been allowed to make a bid for 195 shares at a time, with the opportunity to make multiple bids during the entire process. Retail investors have been allowed to bid 13 times, while the quota has been set at 10% of the total issue. QIB quota is fixed at 75%, while for NIIs the quota is reserved at 15%.
Out of all of this, shares allocated for the QIB were subscribed 98%, while those of NII were subscribed about 13%. Retail investors managed to exceed their allocated quota, and subscribed 2.69 times.
Earlier, Zomato had planned to raise over a billion dollars (₹9,375 crore to be exact) through the IPO. However, earlier today, it was announced that anchor investors have already invested almost half the amount that the company was looking to raise, which led to the IPO size being reduced to ₹5,178.49 crore.
It had planned to sell shares at a band of ₹72-76, with the upper end giving the company a valuation of about $8.6Bn.
