IRCTC IPO fully subscribed on day 2, sees strong demand from retail investors

The initial public offer (IPO) of Indian Railway Catering and Tourism Corporation (IRCTC), a subsidiary of the Indian Railways, was fully subscribed on second day of bidding today.  By 10:15 am, the IRCTC IPO received bids for 2,01,98,680 shares against the issue size of 2,01,60,000 shares. The retail quota was subscribed nearly 3 times. The quota limit of 1,60,000 shares for company employees was also fully subscribed. On the first day of bidding, the Rs 645-crore IRCTC IPO was subscribed 81.31%. The IPO received bids for 1,63,94,040 shares compared to 2,01,60,000 or 2.01 crore equity shares on offer by the firm, data from the NSE show.

The public issue, which will close on October 3, is a part of the government's divestment programme for the financial year 2019-20. The government which owns 100% in IRCTC plans to sell 12.6% stake in the firm. After the IPO, government's stake in the firm will fall to 87.4%.

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IRCTC is engaged in internet ticketing, catering, packaged drinking water and travel and tourism. IRCTC has also diversified into other businesses, including non-railway catering and services such as e-catering, executive lounges and budget hotels.  

The issue involves sale of 2.01 crore equity shares of face value of Rs 10 each in a price band of Rs 315 to Rs 320. Post listing, market capitalisation of the government-owned firm is pegged at Rs 5,120 crore at the higher end of price band

The book running lead managers to the offer are IDBI Capital Markets & Securities, SBI Capital Markets and YES Securities (India).

The company would not receive any proceeds from the IPO and "all proceeds shall go to shareholders", IRCTC said.

Also read: IRCTC IPO commands 50% premium in grey market

Edited by Aseem Thapliyal