Vedant Fashions IPO - Anchor Investments
The anchor issue of Vedant Fashions Ltd saw a robust response on 03-February 2022 and the announcement was made late on Thursday. The IPO opens on 04-February 2022 in the price band of Rs.824 to Rs.866 and shall remain open for 3 days and close on 08-February 2022. Let us focus on the anchor allotment portion ahead of the IPO.
Before we go into the details of the actual anchor allotment, a quick word on the process of anchor placement. The anchor placement ahead of an IPO is different from a pre-IPO placement in that the anchor allocation has a lock-in period of just one month, although under the new rules, part of the anchor portion will be locked in for 3 months, although that will only be effective from April 2022.
Anchor allotment is meant to give confidence to investors that the issue is backed by large established institutions. However, the anchor investor cannot be allotted shares at a discount.
Anchor placement story of Vedant Fashions Ltd
On 03-February 2022, Vedant Fashions Ltd completed the bidding for its anchor allocation. There was a tremendous response as the anchor investors participated through the process of book building. A total of 1,09,09,450 shares were allotted to a total of 75 anchor investors. The allocation was done at the upper IPO price band of Rs.866 which resulted in an overall allocation of Rs.944.76 crore.
Listed below are the 11 key anchor investors who have been allotted more than 2.50% of the anchor allocation each in the IPO. Out of the total anchor allocation of Rs.944.76 crore, these 11 major anchor investor accounted for 41.33% of the overall anchor allocation.
|
Anchor Investor |
No. of Shares |
% of Anchor Portion |
Value Allocated |
|
Government of Singapore |
635,103 |
5.82% |
Rs.55.00 crore |
|
Fidelity Blue Chip Fund |
461,907 |
4.23% |
Rs.40.00 crore |
|
Nomura India Equity Fund |
461,907 |
4.23% |
Rs.40.00 crore |
|
Wellington Asset Management |
461,907 |
4.23% |
Rs.40.00 crore |
|
Ashoka India Opportunities |
461,907 |
4.23% |
Rs.40.00 crore |
|
Morgan Stanley Singapore ODI |
403,685 |
3.70% |
Rs.34.96 crore |
|
Pioneer Investment Fund |
346,426 |
3.18% |
Rs.30.00 crore |
|
SBI Small Cap Fund |
334,883 |
3.07% |
Rs.29.00 crore |
|
ICICI Prudential Life |
317,560 |
2.91% |
Rs.27.50 crore |
|
HDFC Life Insurance Company |
317,560 |
2.91% |
Rs.27.50 crore |
|
Kotak Emerging Equity Fund |
307,938 |
2.82% |
Rs.26.67 crore |
Data Source: BSE Filings
With stable signals coming from the GMP with premiums of about 5.8%, the anchor response has been 30% of the total issue size. The QIB portion in the Vedant Fashion IPO will be reduced to the extent of the anchor placement done above. Only the balance amount will be available for QIB allocation as part of the regular IPO.
The general norm is that, in anchor placements, smaller issues find it hard to get FPIs interested while larger issues do not interest mutual funds. Vedant Fashions Ltd has seen a mix, getting good response from FPIs, and domestic mutual funds.
Among other investors not mentioned in the above list include some marquee names like Monetary Authority of Singapore, Axis Mutual Fund, ICICI Pru Fund, Axis Mutual Fund, Abu Dhabi Investment Authority, Carmignac, Volrado Ventures, Theleme, Elara Funds, Avendus, Sundaram etc.
Out of the total 109.09 lakh shares allotted by way of anchor placement, Vedant Fashions Ltd allotted a total of 36.58 lakh shares to domestic mutual funds, representing 33.53% of the overall anchor allocation. The anchor placement was spread across 44 schemes belonging to 14 different asset management companies.
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