Wednesday, February 3, 2010

Hathway Cable IPO - Analysis, Subscription, Allotment, Listing

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Hathway Cable and Datacom, cable television services provider, is entering capital market with an initial public offering (IPO) of 277.5 lakh equity shares of Rs 10 each on February 9, 2010. The IPO will close on February 11, 2010. It is the leading cable television services provider in India as well as one of the leading cable broadband services providers. It offers analog and digital cable television services across 125 cities and towns and high-speed cable broadband services across 18 cities.

The issue consists of a fresh issue of up to 200 lakh equity shares by the company and an offer for sale of 72.10 lakh equity shares by Monet limited and 5.4 lakh equity shares by MSPI Mauritius India limited. The issue will constitute approximately 19.43% of the post-issue share capital of our company. The promoters' holding will be reduced to 66.55% from 77.37%.

The objective of the fresh issue are to fund customer acquisitions; investment in the development of digital capital expenditure, services and set top boxes; investment in the development of broadband infrastructure, capital expenditure and services; repayment of loans; and fund expenditure for general corporate purposes.

For the period of six months ended on September 2009, it has reported net loss of Rs 35.63 crore and total income of Rs 364.92 crore. It has debt of Rs 443.03 crore on its books.

The book running lead managers to the issue are Morgan Stanley India Company Private Limited, UBS Securities India Private Limited and Kotak Mahindra Capital Company Limited. Link Intime India Private Limited is the registrar.

The IPO received poor response from investors and got subscribed 1.36 times only at the close.

At the close of the IPO,
QII segment was subscribed 1.43 times
NII segment was subscribed 4.3 times
Retail segment was subscribed 0.28 times

Click here to check if you have been alloted Hathway Cable IPO shares!

The investors would not have been happy with this listing. Against the issue price of Rs. 240, the IPO opened at Rs. 250 on NSE, went to a low of Rs. 204 and a high of Rs. 250, before closing the day at Rs. 207, a discount of over 13%.

Watch out this blog for all the details on allotment and listing!
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