Jyoti CNC Automation IPO Subscribed 38.53 times

Jyoti CNC Automation IPO has a face value of ₹2 per share and the price band has been set in the range of ₹315 to ₹331 per share. The final price will be discovered within this band. Jyoti CNC Automation IPO will be entirely a fresh issue of with no offer for sale (OFS) component in the issue. The fresh issue portion of the IPO of Jyoti CNC Automation Ltd comprises the issue of 3,02,11,480 shares (302.11 lakh shares approximately), which at the upper price band of ₹331 per share will translate into a fresh issue size of ₹1,000 crore. Since there is no offer for sale (OFS), the fresh issue portion will also double up as the overall issue size. However, it must be noted that the final number of shares issued are subject to minor modifications based on last minute changes by the issuer of the shares. Such changes are normally very insignificant in nature.

Hence, the overall IPO of Jyoti CNC Automation Ltd will also comprise of the issue of 3,02,11,480 shares (302.11 lakh shares approximately), which at the upper price band of ₹331 per share translates into total IPO size of ₹1,000 crore. The IPO of Jyoti CNC Automation Ltd will be listed on the NSE and the BSE on the IPO mainboard. The fresh issue portion will be largely utilized to repay or prepay some of its loans availed by the company. In addition, the company is also looking to use the funds for financing long term capital requirement and for general corporate purposes. The IPO will be lead managed by Equirus Capital Private Ltd, ICICI Securities Ltd, and SBI Capital markets. Link Intime India Private Ltd will be the registrar to the issue.

How subscriptions evolved in the IPO period

While the QIB portion and the HNI / NII portion picked up traction on the last day, the overall journey was quite rapid for the retail investors. In fact, the QIB portion got fully subscribed only on the third and final day of the IPO while the retail portion got fully subscribed on the first day of the IPO itself. The HNI / NII portion and the overall IPO saw subscription book also filled up on the first day of the IPO itself. The IPO was kept open for a total period of 3 days and here is the day-wise progress in IPO subscription.

As can be seen from the above table, the overall IPO got 38.53 times subscribed at the close of the third and final day of the IPO on 11th January 2024. Here is a quick look at how the various categories saw traction on the last day of the IPO.

• The QIB portion got 0.02 times subscribed at the end of the first day of the IPO. However, on the last day of the IPO, the subscription moved from 0.23X to 44.13X.
   
• The HNI / NII portion got 3.84 times subscribed at the end of the first day of the IPO. However, on the last day of the IPO, the subscription moved from 6.83X to 36.48X.
   
• Retail portion got 8.84 times subscribed at the end of the first day of the IPO. However, on the last day of the IPO, the subscription moved from 11.74X to 26.17X.
   
• The overall IPO got 2.70 times subscribed at the end of the first day of the IPO. However, on last day of the IPO, overall subscription moved from 4.14X to 38.53X.

Rapid update on the overall IPO response

The IPO saw fairly sedate and strong response on the Day-1 and Day-2, with most of the action visible only on Day-3 of the IPO, as is normally the case. However, the IPO did close with relatively healthy subscription numbers at the close of Day-3. In fact, the IPO of Jyoti CNC Automation Ltd got fully subscribed on the first day of the IPO itself as the retail and HNI portion compensated for the lack of subscriptions in the QIB portion on Day-1. As per the combined bid details put out by the BSE at the close of Day-3, Jyoti CNC Automation Ltd IPO was subscribed 38.53X overall, with best demand coming from the QIB segment, followed by the HNI / NII segment and the Retail segment in that order.

In fact, the institutional segment and the HNI / NII segments saw some very good traction on the last day. The HNI portion did do well and a lot of the surge of funding applications and corporate applications did come in on the last day of the IPO. Retail portion was relatively strong, although it was fully subscribed on Day-1 of the IPO itself, but subsequent traction was slower than the others. Firstly, let us look at the details of overall allocation.

Having understood the allocation of shares across various categories, Let us look at how the subscription data played out for the IPO at an overall level and at a more granular level.

As of close of 11th January 2024, out of the 175.40 lakh shares on offer in the IPO, Jyoti CNC Automation Ltd saw bids for 6,758.09 lakh shares. This implies an overall subscription of 38.53X overall. The granular break-up of subscriptions was in favour of the QIB investors followed by the HNI / NII investors and the Retail investors in that order. QIB bids and NII bids typically gather most of the momentum on the last day, and that was the case in this issue also in the case of QIB bids. Both the QIB and the NII bids picked momentum on the last day and added to its heft of the previous days. Here are the details of the category-wise subscription.

Data Source: BSE

Subscription status of QIB Portion

On 08th January 2024, Jyoti CNC Automation Ltd completed the bidding for its anchor allocation. There was a robust response as the anchor investors participated through the process of book building. A total of 1,35,27,190 shares were allotted to a total of 37 anchor investors, of which 22 anchor investors individually got 2% or more of the anchor allocation. The allocation was done at the upper IPO price band of ₹331 per share (including premium of ₹329 per share) which resulted in an overall allocation of ₹447.75 crore. The anchors absorbed 44.78% of the total issue size of ₹1,000 crore.

The QIB portion (net of anchor allocation as explained above) had a quota of 94.76 lakh shares of which it has got bids for 4,182.02 lakh shares at the close of Day-3, implying a subscription ratio of 44.13X for QIBs at the close of Day-3. QIB bids typically get bunched on the last day and while the heavy demand for the anchor placement had given an indication of the institutional appetite for the Jyoti CNC Automation Ltd IPO subscription overall, the actual demand did turn to be quite robust for the IPO.

Subscription status of HNI / NII Portion

The HNI portion got subscribed 36.48X (getting applications for 1,728.50 lakh shares against the quota of 47.38 lakh shares). That is a relatively strong response at the close of Day-3 largely because 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, and that was visible as the overall HNI / NII portion added to its heft on the last day of the IPO. Apart from the QIB portion, even HNIs saw good traction on the last day.

Now the NII/HNI portion is reported in two parts viz. bids below ₹10 lakhs (S-HNI) and bids above ₹10 lakhs (B-HNI). The bids above the ₹10 lakh category (B-HNIs) typically represents most of the major funding customers. If you break up the HNI portion, the above ₹10 lakh bid category got subscribed 40.70X while the below ₹10 lakh bid category (S-HNIs) got subscribed 28.04X. This is just for information and is already part of the overall HNI bids explained in the previous para.

Subscription status of Retail Individuals

The retail portion was subscribed 26.17X at the close of Day-3, showing relatively strong appetite. It must be noted that retail allocation is just 10% in this IPO. For retail investors; out of the 31.59 lakh shares on offer, valid bids were received for 826.78 lakh shares, which included bids for 719.33 lakh shares at the cut-off price. The IPO is priced in the band of (₹315 to ₹331 per share) and has closed for subscription as of the close of Thursday, 11th January 2024.