Keystone Realtors Ltd (Rustomjee) IPO gets 30% anchor allocated

Keystone Realtors IPO anchor Allotment
Keystone Realtors IPO anchor Allotment

IPOs
by 5paisa Research Team Last Updated: 2022-11-14T17:04:46+05:30

The anchor issue of Keystone Realtors Ltd (Rustomjee) saw a robust response on 11th November 2022 with 30% of the IPO size getting absorbed by the anchors. Out of the 1,17,37,523 shares on offer, the anchors picked up 35,21,255 shares accounting for 30% of the total IPO size. The anchor placement reporting was made to the BSE late on Friday. The IPO of Keystone Realtors Ltd (Rustomjee) opens on 14th November 2022 in the price band of Rs.514 to Rs.541 and will close for subscription on 16th November 2022 (both days inclusive). The entire anchor allocation was made at the upper price band of Rs541. Let us focus on the anchor allotment portion ahead of the Keystone Realtors Ltd IPO.

Keystone Realtors IPO - APPLY or NOT? | Keystone Realtors (Rustomjee) IPO Review: 

 

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/FPO 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. It is just to give confidence to investors that the issue is backed by large established institutions.

However, the anchor investors cannot be allotted shares at a discount to the IPO price. This is explicitly stated in the SEBI revised regulations as under, “As per the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirement) Regulations, 2018, as amended, in case the Offer Price discovered through book building process is higher than the Anchor Investor Allocation Price, then the Anchor investors will be required to pay the difference by the pay-in as specified in the revised CAN.

An anchor investor in an IPO is normally a qualified institutional buyer (QIB) like a foreign portfolio investor or mutual fund or insurance company or a sovereign fund which invests before the IPO is made available to the public as per SEBI regulations. Anchor portion is part of the public issue, so the IPO portion to the public (QIB portion) is reduced to that extent. As initial investors, these anchors make the IPO process more attractive for investors, and instil confidence in them. Anchor investors also largely aid in price discovery of the IPO

Anchor placement story of Keystone Realtors Ltd (Rustomjee)

On 11th November 2022, Keystone Realtors Ltd (Rustomjee) completed the bidding for its anchor allocation. There was an enthusiastic response as the anchor investors participated through the process of book building. A total of 35,21,255 shares were allotted to a total of 16 anchor investors. The allocation was done at the upper IPO price band of Rs.541 which resulted in an overall allocation of Rs.190.50 crore. The anchors have already absorbed 30% of the total issue size of Rs635 crore, which is indicative of the robust institutional demand.

Listed below is the complete list of 16 anchor investors who got allotted shares as part of the anchor allocation. The entire anchor allocation of Rs.190.50 crore was spread across these 16 major anchor investors in the case of Keystone Realtors Ltd (Rustomjee).

Anchor Investor

No. of Shares

% of Anchor Portion

Value Allocated

Abu Dhabi Investment Authority

554,553

15.75%

Rs.30.00 crore

Morgan Stanley India Investment Fund

437,184

12.42%

Rs.23.65 crore

SBI Life Insurance Company

277,290

7.87%

Rs.15.00 crore

Tata Small Cap Fund

277,290

7.87%

Rs.15.00 crore

Quant Value Fund

277,290

7.87%

Rs.15.00 crore

Troo Capital Ltd

277,290

7.87%

Rs.15.00 crore

Aditya Birla Sun Life Small Cap Fund

249,507

7.09%

Rs.13.50 crore

IDFC Emerging Business Fund

184,869

5.25%

Rs.10.00 crore

HDFC Life Insurance Company

166,374

4.72%

Rs.9.00 crore

IIFL Special Opportunities Fund

166,374

4.72%

Rs.9.00 crore

Saint Capital Fund

129,261

3.67%

Rs.6.99 crore

Ananta Capital Ventures Fund

129,261

3.67%

Rs.6.99 crore

Morgan Stanley India Equity Fund

117,369

3.33%

Rs.6.35 crore

Aditya Birla SL Bhavishya Yojana

92,475

2.63%

Rs.5.00 crore

BNP Paribas Arbitrage

92,448

2.63%

Rs.5.00 crore

IDFC Multi-Cap Fund

92,421

2.62%

Rs.5.00 crore

Grand Total Anchor Allocation

35,21,255

100.00%

Rs.190.50 crore

Data Source: BSE Filings

The stock is not active in grey market, so we do not have a reliable GMP as of now. Despite that, we have seen fairly strong anchor response with the anchors taking in 30% of the total issue size. The QIB portion in the 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. Keystone Realtors Ltd (Rustomjee) has been a mix, getting good response from FPIs and also strong response from the domestic mutual funds and insurance companies. The number and spread of the Foreign Portfolio Investors has been fairly healthy in this case. With strong SIP flows, most equity funds are flush with cash at this point and that has helped the MF appetite for anchor allocation in this Keystone Realtors IPO.

Out of the total 35,21,255 shares allotted by way of anchor placement, Keystone Realtors Ltd (Rustomjee) allotted 11,73,852 shares to 6 domestic mutual fund schemes across 4 AMCs. The mutual fund allocation represents 33.34% of the overall anchor allocation.


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