Friday, October 8, 2010

Prestige Estates IPO - Analysis, Recommendation, Subscription, Allotment, Listing

Analysis:
Prestige Estates, a real estate company, is entering capital market with an initial public offering of Rs 1200 crore.

The IPO will open on October 12 and close on October 14, 2010. The company has fixed price band of Rs 172 - 183.

The issue is being made through the 100% book building process wherein at least 60% of the net issue will be allocated on a proportionate basis to qualified institutional buyers (QIBs). It is provided that the company may allocate up to 30% of the QIB portion, to anchor investors, on a discretionary basis. Further 5% of the QIB portion less anchor investor portion shall be available for allocation on a proportionate basis to mutual funds only. The remainder shall be available for allocation on a proportionate basis to QIBs and Mutual Funds, subject to valid bids being received from them at or above the issue price. Further, not less than 10% of the net issue will be available for allocation on a proportionate basis to non-institutional bidders and not less than 30% of the Net Issue will be available for allocation on a proportionate basis to Retail Individual Bidders, subject to valid Bids being received at or above the Issue Price. Bidders may participate in the Issue through the ASBA process by providing the details of their respective bank accounts in which the corresponding Bid amounts will be blocked by Self Certified Syndicate Banks.

Issue proceeds are proposed to be used for financing ongoing projects and projects under development; existing subsidiaries which investment will be utilized for the construction and development of commercial ongoing project, retail ongoing and retail projects under development undertaken by subsidiaries; acquisition of land; and for repaying certain loans.

Recommendation:
ICRA has assigned Grade 3 to the IPO. Some of the recent IPOs have got a mixed response at the time of listing. We would recommend investors to be cautious and avoid taking risk right now.

Subscription:
The IPO got subscribed 2.26 times. At the close of the IPO,
QII segment got subscribed 4.32 times
NII segment got subscribed 0.24 times
Retail segment got subscribed 0.08 times
Employee reservation segment got subscribed 0.24 times

Allotment:
Check if you have been alloted Prestige Estates shares!

Listing:
Prestige Estates IPO got listed on 27th October. The share closed at Rs 190.20, a premium of 3.93% over an issue price of Rs 183 a share; after hitting an intraday high of Rs 208.80 and low of Rs 188.35 on the NSE.


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