MindTree IPO subscribed 103 times

The bearish sentiment in the market seems to be impacting the fate of smaller initial public offerings (IPOs) with at least one company deciding to extend the date of closure of the issue, while bigger companies, MindTree Consulting and Idea Cellular, have become a runaway success.

At least five IPOs are currently open while the highly-rated MindTree Consulting and Idea Cellular, which closed today and yesterday respectively, received overwhelming response from investors. The other issues currently open include Raj Television, Evinix Accessories and AMD Metplast.

The MindTree IPO, which closed today, has been subscribed 103 times, making it one of the most successful issues in recent times, according to market sources.

The only issue to have done better recently is that of Sobha Developers, also Bangalore based, which was over subscribed 114 times. But the Sobha issue had hit the market at a time when it was buoyant, unlike the last few days when the MindTree issue was open.Idea was subscribed 27 times.

The issue got good response from both the retail and the qualified institutional buyers. The IPO of Vijayeswari Textiles was, however, not that lucky.

Following a lukewarm response, the company was forced to extend the issue closing date by another six days from February 13 to February 19. The company, which hopes to raise Rs 90 crore, also revised its price band from Rs 115-130 to Rs 100-115.

Another feature of MindTree's $100 million IPO is that the employees' portion has been over- subscribed more than six times, against the usual practice of the portion being at best over- subscribed one-and-a-half times.

At the indicated price band, the issue will garner Rs 204-237 crore, representing around 15 per cent of the post-issue paid-up capital. None of the existing institutional investors have exited through this issue.

The response for Idea Cellular, which began on a slow pace picked up, especially after the Vodafone deal to acquire Hutch. The company is selling 33 crore shares and the price band is Rs 65-75. Analysts said after the Vodafone deal, the pricing for Idea Cellular's IPO looked attractive. The company hopes to raise about Rs 2,500 crore through the IPO (excluding a greenshoe option of Rs 318.75 crore).