India: Diagnostics chain Thyrocare IPO gets 56% bids on Day 1

Visual from site.

Retail investors rushed to bid for shares in diagnostics firm Thyrocare Technologies Ltd’s initial public offering (IPO) on Wednesday, leading to a 56% subscription on the first of a three-day public issue. The share sale will end on 29 April.

As of 5pm, the Rs.480 crore share sale received bids for 4.21 million shares against the total issue size of 7.52 million shares, data from stock exchanges showed.

The retail investors category received 101% or 1.01 times the subscription. Retail individual investors, whose share application in public issues cannot exceed Rs.2 lakh, bid for 3.82 million shares compared with 3.76 million shares reserved for them.

Non-institutional investors comprising high net-worth individuals bid nearly 10% of the 1.61 million shares on offer.

The portion reserved for qualified institutional buyers (QIBs) also received 10% bids against the 2.14 million shares on offer.

On Tuesday, Navi Mumbai-based Thyrocare raised Rs.143.76 crore through an anchor allotment. The company issued 3.22 million shares to 15 institutional investors at Rs.446 apiece, the upper band of the issue price. The company has fixed the IPO price band at Rs.420-446 per share.

Institutions that received Thyrocare shares on Tuesday include Nomura Trust and Banking Co. Ltd, DB International (Asia) Ltd, Birla Sunlife Trustee Co. Pvt. Ltd, Reliance Capital Ltd, ICICI Prudential Asset Management Co. Ltd and SBI Funds Management Pvt. Ltd.

The anchor book is that portion of the IPO that bankers can allot to institutional investors on a discretionary basis. Anchor-book subscription opens a day before the launch of an IPO and acts as an indicator of institutional investor interest.

JM Financial Institutional Securities Ltd, Edelweiss Financial Services Ltd and ICICI Securities Ltd are bankers to the Thyrocare public issue.

Meanwhile, Thyrocare’s shares were trading at a Rs.180-200 premium in the grey market. Micro-finance lender Ujjivan Financial Services’ IPO, which opens on Thursday with a price band of Rs.207-210 per share, was quoting at a premium of Rs.45-50 per share.

Thyrocare is a pan-India diagnostic chain, which conducts an array of medical diagnostic tests that centre on early detection and management of health disorders.

The firm reported a profit of Rs.48.4 crore on revenue of Rs.187 crore for the financial year 2014-15, compared to a profit ofRs.46.1 crore on revenue of Rs.156.5 crore in the previous financial year.

Thyrocare was looking to list its shares last year, but the issue hit a roadblock after the company was found to be non-compliant with the Companies Act. The firm’s management requested clarification from capital market regulator Securities and Exchange Board of India in connection with the shares issued to 51 people 10 years ago,Mint reported on 26 May last year.

The Companies Act, 1956, did not allow an unlisted company to allot securities to more than 49 investors in a financial year. The clause was relaxed in the Companies Act, 2013, wherein the cap was increased to 200 investors.

Thyrocare’s public issue is the eighth IPO this calendar year. It is being launched at a time when secondary markets have risen 4.75% in the past six sessions. The BSE’s 30-share benchmark Sensex index has advanced more than 12% since mid-February.

Seven firms have tapped primary markets to raise close toRs.3,200 crore since 1 January, according to Prime Database, which tracks share sales. Last year, 21 firms raised almostRs.13,600 crore through the IPO route, data showed.

This article was first published on Livemint.com

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.