Rainbow Children’s Medicare IPO - Subscription Day 1

5paisa Research Team 5paisa Research Team 10th December 2022 - 06:55 pm

The Rs.1,580.85 crore IPO of Rainbow Children’s Medicare Ltd Solutions, consisting of a fresh offer of Rs.280 crore and offer for sale (OFS) of shares worth of Rs.1,300.85 crore, saw tepid response overall on Day-1 of the IPO.

As per the combined bid details put out by the BSE at the end of Day-1, Rainbow Children’s Medicare IPO was subscribed 0.29 times or 29% subscription overall, with reasonable demand traction seen in the retail segment but tepid demand in the HNI / NII segment and the QIB segment of the IPO. The initial public offer (IPO) will close for subscription on Thursday, 29th April 2022.

As of close of 27th April 2022, out of the 205.15 lakh shares on offer in the IPO (net of anchor allocation), Rainbow Children’s Medicare Ltd saw bids for 59.63 lakh shares. This implies an overall subscription of 0.29 times or 29% of the issue size.

The granular break-up of subscriptions was reasonable for retail investors but tepid for the HNI / NII investors and for the QIBs. Normally, it is only on the last day of bidding, the NII/HNI bids and the QIB bids build up substantial momentum. We should get a clearer picture by the end of third day of subscription only.

Rainbow Children’s Medicare IPO Subscription Day 1

Category	Subscription Status
Qualified Institutional Buyers (QIB)	0.10 Times
Non Institutional Investors (NII)	0.11 Times
Retail Individuals	0.48 Times
Employees	0.07 Times
Overall	0.29 times

QIB Portion

On 26th April, Rainbow Children’s Medicare Ltd completed an anchor placement of shares to anchor investors. A total of 86,63,404 shares of Rainbow Children’s Medicare Ltd Solutions were allocated to 36 anchor investors at the upper price band of Rs.542 per share.

Here are the top 6 anchor investors in Rainbow Children’s Medicare IPO.

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

The total anchor allocation of Rs.469.56 crore was spread across 36 investors. The total anchor allocation of 86.63 lakh shares was done at the upper price band of Rs.542. The total anchor allocation amounted to 29.70% of the total issue size. Out of the total anchor portion, 44.99% was made to 18 mutual fund schemes spread across 9 AMCs.

Check - Rainbow Children’s Medicare IPO - Anchor Placement Details

The QIB portion (net of anchor allocation as explained above) has a residual quota of 57.76 lakh shares of which it has got bids for 5.60 lakh shares at the close of Day-1, implying 0.10 times or 10% subscription for QIBs at the close of Day-1. However, QIB bids typically get bunched on the last day, although we have to wait and see how the response mechanism of QIBs build up in the next 2 days of the IPO.

The anchor demand was reasonably robust across different classes of institutions. It must also be remembered that the QIB allocation is 50% in the IPO while it is 15% for HNI / NIIs and 35% for retail.

HNI / NII Portion

The HNI portion got subscribed 0.11 times or 11% (getting applications for 4.93 lakh shares against the quota of 43.32 lakh shares). This is a relatively good response at the close of Day-1 with most of the response coming from HNI individuals.

However, this segment normally sees 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 only.

Retail Individuals

The retail portion was subscribed a relatively better 0.48 times or 48% at the close of Day-1 and that could throw up a clearer picture on the second day of the IPO. Retail interest is normally seen in the first 2 days, so the eventual interest level looks to depend largely on Day-2 and partially on Day-3.

For retail investors; out of the 101.07 lakh shares on offer, valid bids were received for 48.90 lakh shares, which included bids for 38.90 lakh shares at the cut-off price. The IPO is priced in the band of (Rs.516-Rs.542) and will close for subscription on 29th April 2022.

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