Veranda Learning IPO - Subscription Day 3

veranda-learning-solutions

IPO
by 5paisa Research Team Last Updated: 2022-03-31T18:22:03+05:30

The Rs.200 crore IPO of Veranda Learning Solutions, consisting entirely of a fresh issue of shares worth of Rs.200 crore, saw strong retail response on Day-1 and Day-2 of the IPO. As per the combined bid details put out by the BSE at the end of Day-3, Veranda Learning Solutions IPO was subscribed 3.53 times overall, with good demand traction seen in the retail segment followed by some reasonable interest from the HNI / NII segment and the QIB segment too. The initial public offer (IPO) has closed for subscription on Thursday, 31st March 2022.

As of close of 31st March 2022, out of the 117.88 lakh shares on offer in the IPO, Veranda Learning Solutions saw bids for 415.55 lakh shares. This implies an overall subscription of 3.53 times of the issue size.

The granular break-up of subscriptions was dominated by retail investors followed by the HNI / NII investors with demand seen from QIBs just about catching up.

Normally, it is only on the last day of bidding, the NII/HNI bids and the QIB bids build up substantial momentum. However, it must be remembered that 75% of the issue quota was reserved for QIB investors with only 10% for retail investors.
 

Veranda Learning Solutions IPO Subscription Day 3
 

Category

Subscription Status

Qualified Institutional Buyers (QIB)

2.02 Times

Non Institutional Investors (NII)

3.87 Times

Retail Individuals

10.76 Times

Employees

Not Applicable

Overall

3.53 times

 

QIB Portion

On 28th March, Veranda Learning Solutions completed an anchor placement of shares to anchor investors. A total of 34,12,500 shares of Veranda Learning Solutions were allocated to 3 anchor investors as under.
 

Anchor Investor

No. of

Shares

% of Anchor

Portion

Value

Allocated

% of Overall

Issue Size

AG Dynamic Funds Ltd

18,24,900

53.48%

Rs.25.00 crore

12.50%

Resonance Opportunities Fund

7,30,000

21.39%

Rs.10.00 crore

5.00%

Next Ventures Orbit Fund

8,57,600

25.13%

Rs.11.75 crore

5.87%

Total Anchor Allocation

34,12,500

100.00%

Rs.46.75 crore

23.38%

 

As can be seen from the above table, the total anchor allocation of Rs.46.75 crore was spread across just 3 investors. The total anchor allocation of 34.125 lakh shares was done at the upper price band of Rs.137. The total anchor allocation amounted to 23.38% of the total issue size. No anchor allocation was made to domestic mutual funds as part of the anchor placement.

The QIB portion (net of anchor allocation if any) has a quota of 79.42 lakh shares of which it has got bids for 160.64 lakh shares at the close of Day-3, implying 2.02 times subscription for QIBs at the close of Day-3.
 

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However, QIB quota was 75% and they typically get bunched on the last day of the IPO. The anchor demand was narrow but robust. It must also be remembered that the QIB allocation is 75% in the IPO followed by 15% for HNI / NIIs and 10% for retail investors in the current issue.

HNI / NII Portion

The HNI portion got subscribed 3.87 times (getting applications for 89.31 lakh shares against the quota of 23.08 lakh shares). This is a relatively good response at the close of Day-3 with most of the response coming from HNI individuals followed by the demand from corporates.

However, this segment did see the maximum response bunched on the last day. Bulk of the funded applications and corporate applications, come in on the last day of the IPO in the normal course.

Retail Individuals

The retail portion was subscribed a relatively strong 10.76 times at the close of Day-3 but that was more because the retail quota is just 10% of the issue size. Retail interest is normally seen in the first 2 days, which was relatively strong.

Hence, the overall retail demand was expected to be robust at the close of Day-3. For retail investors; out of the 15.384 lakh shares on offer, valid bids were received for 165.60 lakh shares, which included bids for 131.84 lakh shares at the cut-off price. The IPO is priced in the band of (Rs.130-Rs.137) and has closed for subscription on 31st March 2022.
 

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