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    Thursday , May 05, 2016


   Publication: Mint , Journalist:Ankit Doshi
   Edition: Mumbai/ Delhi/ Ahmedabad/ Pune/ Chandigarh/ Bangalore/ Chennai/ Hyderabad/ Kolkata , Page No: 11 , Location: Top , Size(sq.cms): 300

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Parag Milk sees 10% subscription on IPO's day one

The dairy firm, which plans to raise Rs75O cr, got bids for 1.97 mn shares against the total issue size of 19.18 mn
By Ankit Dosiii & Ami Shah
pared to its peers.
Brokerage Prabhudas Lillad-her Pvt. Ltd, recommended a 'subscribe' rating for the IPO and highlighted that while the firm has good long-term prospects with scope of decent returns over the next 2-3 years, it would offer limited gains at listing.
Parag Milk will allot at least 75% of the shares on a propor­tionate basis to qualified institu­tional buyers, 15% to non-insti­tutional investors, comprising high net-worth individuals, and 10% to retail investors.
Based on the price band set by the firm, the total issue size will range between Rs752.6 crore and Rs767.6 crore, of which the firm's promoters and private equity (PE) investors will collectively garner upward of Rs450 crore by selling 20.57 million shares.
IDFC Private Equity, a wholly owned subsidiary of IDFC Ltd, has offered to sell about 58.4% of its holding. The Mumbai-based entity, which holds about a 20.1% stake, will sell about 8.26 million shares, according to the share sale documents.
Other PE investors in the com­pany—India Excellence Business Fund (IBEF) and IBEF-1 spon­sored by Motilal Oswal Financial Services Ltd—will sell 6.02 mil­lion shares.
The company intends to raise Rs300 crore in fresh capital.
Shares of Parag Milk were quoting at a premium of Rs5-15 per share in the grey market on Wednesday, after rising to Rs35-40 apiece last week, two dealers said, requesting ano­nymity, adding that investor interest was subdued due to expensive valuations.
"The issue is expensive, and interest in grey market is not much, as people are not expect­ing to gain big on listing," said one of the dealers cited above.
The grey market is an over-the-counter market where IPO shares are bought and sold before a company officially lists on the stock exchange.

I nvestors bid for about 10% of the shares offered by dairy firm Parag Milk Foods Ltd on Wednesday, the first of a three-day initial public offering (IPO) intended to raiseRs750 crore.
As of 5.30pm, Parag Milk received bids for 1.97 million shares against the total issue size of 19.18 million, stock exchange data showed.
The qualified institutional buyers (QIB) category, excluding the anchor allotment, witnessed 13% subscription.
Non-institutional investors, or high net-worth individuals, ordered 3% of the shares set apart for them; retail investors, whose share application in pub­lic issues cannot exceed Rs2 lakh, bought 15% of the stock ear­marked for them, data showed.
The company is offering a dis­count of Rsl2 per equity share to all retail investors and eligible employees.
On Tuesday, Pune-based Parag Milk raised nearly Rs343 crore from anchor investors ahead of its IPO. The company allotted 15.1 million shares to 17 anchor investors at Rs227 apiece, the upper end of the t220-227 price band fixed for the IPO.
Brokerages were divided on their views for the IPO, with some recommending investors to avoid the issue, while some asking them to subscribe.
IIFL Holdings Ltd, which has an 'avoid' rating on the issue, said that at the upper IPO price band, the company is richly priced related to the growth prospects and also the emerging competition, and even after a Rs12 discount to retail investors, the issue is still expensive, com-

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Date: Thursday , May 05, 2016
Publication: Mint, Journalist: Ankit Doshi
Edition: Mumbai/Delhi/Ahmedabad/Pune/Chandigarh/Bangalore/Chennai/Hyderabad/Kolkata, Page No: 11, Location: Top, Size(sq.cms): 300