Swajas Air cuts IPO price band, defers issue

After receiving a poor response to its initial public offer (IPO) due to volatile market conditions, Swajas Air Charters has cut the price band of initial share sale offer to Rs 84-90 a share and extended the issue by five more trading sessions.

The company said that the price band has been revised to Rs 84-90 per share as against Rs 90-100 fixed earlier for its IPO of 44.64 lakh shares, according to the information available with the National Stock Exchange.

Further, it said the issue would close on October 5 instead of earlier closing day of September 28.

Analysts said that despite weak market conditions, there was no doubt that investors were ready for quality IPOs.

"The market condition is very volatile but good IPOs are always in demand. I think aggressive pricing issue was the main reason for revising the price-band," Geojit Financial Services Research Head Alex Mathew said.

Swajas Air Charters' IPO, which opened on September 26, has a low subscription of 0.01 times till 1600 hrs today. The company has received bids for 65,640 shares, compared with 4.464 million shares on offer.

Besides, the IPOs of financial service company Onelife Capital Advisors and transformer manufacturer M and B Switchgears, which were opened yesterday, also failed to attract investors' interest on the second day of subscription today.

Meanwhile, Swajas Air Chaters proposes to utilise the net proceeds of the issue to part finance the fleet expansion, finance the setting up of MRO/Hangar facility, finance the purchase of office building/space, meet the working capital requirements and general corporate purposes.