WonderLa IPO Oversubscribed: Bids Come In for 37.5x of the Issue

3 comments Written on April 23rd, 2014 by
Categories: IPO

WonderLa’s IPO is now oversubscribed 37.5x with more than 46 crore shares bid for (there were only 1.45 cr. shares on offer).

Read: WonderLa, a Low Priced IPO of a Theme Park, posted yesterday.

 

image

The bids have, largely come at 125 or cut-off. Retail investors, who had around 50 lakh shares reserved for them, have bid for at least 2.89 cr shares (“Cut-Off” is only for retail) which is a 5x oversubscription.

Chances of allotment are low because even with proportional allotment they might have to pick randomly to decide which investors to allot shares.  I believe with this kind of the demand the share should see a premium of 30% to 50% on listing.

Effectively with 46 crore shares applied for at Rs. 125, that is 5,800 crore rupees that is allocated to the listing. And we’re not at the end of the day yet.

This is the beginning of mad IPO season and if this is successful, I expect a whole lot more. This is a great buildup before a big drop, and I would keep my stop losses tight and unadjusting, but I will participate!

Related Posts Plugin for WordPress, Blogger...

Tags:

About the Author:
http://www.capitalmind.in
The man behind Capital Mind. Deepak is a co-founder at MarketVision, a financial knowledge company. Deepak also provides data research and consulting services, and now lives in Bangalore. Connect with him at deepakshenoy@capitalmind.in.

3 comments “WonderLa IPO Oversubscribed: Bids Come In for 37.5x of the Issue”

Proportional allotment will not be there for Retail as per my understanding. Every application will have an equal chance of getting allotted 1 lot. That chance is 1 out of 5 application will get 1 lot. Correct me if I am wrong here.

Looks like you’re right. Possibly they will reduce the number of shares allocated per lot to say 20 or so.

Can the lot size be reduced? My understanding is a minimum of 1 lot needs to be allotted, the applicants to whom this would be allotted would be done based on a lottery.