InterGlobe Aviation IPO off to flying start; subscribed 87%

Mumbai: The Rs 3,018-crore initial public offer of IndiGo's parent InterGlobe Aviation, the biggest in nearly three years, started on a promising note as the issue was subscribed 87 percent on the first day itself.

With this, the company's IPO has emerged as the most sought after public offer so far this year as the issue witnessed strong investor response on the first day itself.

Prior to this, VRL Logistics' public issue was subscribed 62 percent on the first day of the issue in April this year.

The much-awaited InterGlobe IPO received bids for 2,60,58,525 shares against the total issue size of 3,01,22,088 shares, data available with the NSE till 1700 hours showed.

The quota reserved for qualified institutional buyers (QIBs) was over-subscribed 2.96 times.

QIBs bid for 2,52,03,360 shares against 85,22,935 shares reserved, thus generating demand for shares worth Rs 1,928 crore.

The portion reserved for retail investors saw 5 percent subscription and non institutional investors category was subscribed 2 percent, as per the NSE data.

A major chunk of QIB portion was almost fully subscribed (94 percent) within first hour of issue opening, merchant bankers said.

InterGlobe Aviation has already raised Rs 832 crore from anchor investors by allotting shares at the upper price band of Rs 765 apiece.

InterGlobe hit the capital markets to raise Rs 3,018 crore through the initial public offering, the biggest in nearly three years. The price band for the offer has been fixed at Rs 700-765 per share.

The company had reduced its initial share sale size to a little over Rs 3,000 crore last week, with three of the promoters deciding to sell less number of shares than proposed earlier.

The offer comprises fresh issue of shares worth Rs 1,272.2 crore and the revised Offer for Sale (OFS) size that would be about Rs 1,746 crore. Together, the share sale can rake in up to Rs 3,018.2 crore.

The IPO would conclude on October 29.

Barclays Bank PLC, Kotak Mahindra Capital Company Limited and UBS Securities India are managing the issue.

IndiGo has a fleet of 98 aircraft and about 75 of them are on operating lease - a business model which has helped it lower costs.