Rainbow Children’s Medicare IPO - Anchor Placement Details

The anchor issue of Rainbow Children’s Medicare Ltd saw a robust response on 26th April 2022 and the announcement was made late on Tuesday.

The IPO opens on 27th April 2022 in the price band of Rs.516 to Rs.542 and shall remain open for 3 working days and close on 29th April 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/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.

Anchor placement story of Rainbow Children’s Medicare Ltd

On 26th April 2022, Rainbow Children’s Medicare 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 86,63,404 shares were allotted to a total of 36 anchor investors. The allocation was done at the upper IPO price band of Rs.542 which resulted in an overall allocation of Rs.469.56 crore.

Listed below are the 10 anchor investors who have been allotted more than 4.00%  of the anchor allocation each in the IPO. Out of the total anchor allocation of Rs.469.56 crore, these 10 major anchor investors accounted for 61.69% of the overall anchor allocation.
 

Anchor Investor	No. of Shares	% of Anchor Portion	Value Allocated
SBI Healthcare Opportunities Fund	745,478	8.61%	Rs.40.41 crore
Amansa Holdings Private Limited	745,478	8.61%	Rs.40.41 crore
Neuberger Berman EM Equity	684,342	7.90%	Rs.37.09 crore
Government of Singapore	653,076	7.54%	Rs.35.40 crore
Ashoka India Opportunities Fund	592,056	6.83%	Rs.32.09 crore
Nippon India Pharma Fund	447,228	5.16%	Rs.24.24 crore
HDFC Life Insurance	369,036	4.26%	Rs.20.02 crore
Birla Sun Life Small Cap Fund	369,036	4.26%	Rs.20.02 crore
DSP Small Cap Fund	369,036	4.26%	Rs.20.02 crore
Baroda BNP Multi Cap Fund	369,036	4.26%	Rs.20.02 crore

 

_{Data Source: BSE Filings}

With stable signals coming from the GMP with premiums of about 10%, the anchor response has been 29.70% of the total issue size. The QIB portion in the Rainbow Children's Medicare 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. Rainbow Children’s Medicare Ltd has been a mix, getting good response from FPIs and domestic mutual funds.

Apart from the above list, some of the major Foreign Investors that put money in the anchor issue include, India Acorn ICAV, Matthews Emerging Markets Small Companies Fund, Ghisallo Master Fund LLP and Goldman Sachs Singapore (ODI Account).

Among the key domestic investors that invested in the anchor placement, apart from the list mentioned in the table were Axis Mutual Fund, IIFL Special Opportunities Fund, HDFC Life Insurance, Max Life Insurance, Aditya Birla Sun Life Mutual Fund, Motilal Oswal Mutual Fund, Bajaj Allianz Life Insurance and HSBC Mutual Fund.

Out of the total 86.63 lakh shares allotted by way of anchor placement, Rainbow Children’s Medicare Ltd allotted a total of 38.97 lakh shares to 18 domestic mutual fund schemes across 9 AMCs. The mutual fund allocation represents 44.99% of the overall anchor allocation.

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