Marinetrans India IPO oversubscribed 33 times in final subscription

About the Marinetrans India IPO

Marinetrans India IPO opened for subscription on 30th November 2023 and closed for subscription on 05th December 2023. The stock of India Ltd has a face value of ₹10 per share and it is a fixed price issue; with the price already set at ₹26 per share for the IPO. The IPO of Marinetrans India Ltd has only a fresh issue component with no offer for sale (OFS) portion. As part of the fresh issue portion of the IPO, Marinetrans India IPO will issue a total of 42,00,000 shares (42 lakh shares), which at the IPO fixed price of ₹26 per share aggregates to a total IPO fund raising of ₹10.92 crore. Since there is no offer for sale portion, the total size of the fresh issue will also be the total size of the IPO. Hence the overall IPO size will also comprise of 42,00,000 shares, which at the fixed IPO price of ₹26 per share aggregates to ₹10.92 crore.

The minimum lot size for the IPO investment was 4,000 shares. Thus, retail investors can invest a minimum of ₹104,000 (4,000 x ₹26 per share) in the IPO. That is also the maximum that the retail investors can invest in the IPO. HNI / NII investors can invest a minimum of 2 lots comprising of 8,000 shares and having a minimum lot value of ₹208,000. There is no upper limit on what the QIBs as well as what the HNI / NII investors can apply for. Being an SME issue, Marinetrans India Ltd had a market making portion with a market maker inventory allocation of 2,16,000 shares. The market maker, NNM Securities Private Ltd, will provide two-way quotes to ensure liquidity on the counter post listing and low basis costs. The promoter quota will get diluted post the IPO from 100% to 67%. The fresh funds will be used by Marinetrans India Ltd to fund the working capital needs of the company. Swaraj Shares and Securities Private Ltd will be the lead manager to the issue, and Skyline Financial Services Private Ltd will be the registrar to the issue.

Final subscription status of Marinetrans India IPO

Here is the final subscription status of the Marinetrans India Ltd as at close on 05th December 2023.

As can be seen from the above table, the overall IPO of Marinetrans India Ltd got subscribed an impressive 33.00 times. The Retail portion led the stakes with 47.24 times subscription, followed by the HNI / NII portion at 18.05 times subscription. There was no QIB allocation in the IPO at all. This overall represents a modest to smart response to an SME IPO, especially if you consider the median subscriptions that similar other SME IPOs have got in the past. The subscription has shown fairly good traction for the IPO across all categories of investors.

Allocation quota for various categories

The issue was open for QIBs, retail investors, and the HNI / NII investors. There was a broad quota designed for each of the segments viz. the retail, the QIB and the HNI / NII segments. A total of 2,16,000 shares were allocated as market maker portion to NNM Securities Private Ltd, which will act as market maker inventory to provide bid-ask liquidity on the counter post listing. Market maker action not only improves liquidity in the counter but also reduces the basis risk. The table below captures the allocation reservation done for each of the categories out of the total number of shares offered in the IPO.

In the above IPO of Marinetrans India Ltd, there was no QIB portion and hence there was no anchor allocation made. Normally, the anchor allocation is carved out of the QIB portion and it is completed a day ahead of the opening of the IPO. The company did not have any anchor quota for institutional investors in the IPO. The net issue was just net of the market maker portion, which was apportioned equally between the retail investors and the non-institutional investors. The market making portion of 5.14% is independent of the anchor allocation. The anchor portion is carved out of the QIB portion and so the QIB quota available to the public is normally reduced by the anchor size. There is no adjustment in the above allocation, in the absence of any anchor quota.

How subscription built up for the IPO of Marinetrans India Ltd

The oversubscription of the IPO was dominated by the retail investors followed closely by the HNI / NII investors and then the QIB category in that order. The table below captures the day-wise progression of the subscription status of Marinetrans India Ltd. The IPO was kept open for 4 working days.

Here are the key takeaways from the subscription numbers on a day-wise basis for Marinetrans India Ltd.

• The Retail portion got the best subscription in the Graphisads Ltd IPO at 47.24 times and it got 2.62 times subscribed on the first day of the IPO.
   
• The HNI / NII portion was behind the Retail portion in terms of subscription at 18.05 times overall and it got just 0.56 times subscribed at the end of the first day.
   
• While the retail portion got fully subscribed on the first day of the IPO itself, the HNI / NII portion got fully subscribed only on the second day of the IPO. Overall, the IPO got fully subscribed on the first day, although progress after that was quite slow.
   
• The overall IPO got subscribed 33.00 times at the close of Day-4 of the IPO but it had been subscribed just about 1.59 times at the end of the first day. For all categories, the traction on the last day was fairly attractive.
   
• The retail and HNI / NII portion saw relatively strong traction on the last day of the IPO. The Retail portion saw the total subscription ratio moving from 13.75X to 47.24X on the last day of the IPO. Even the HNI / NII portion saw the total subscription ratio move from just 2.51X to 18.05X on the last day of the IPO.
   
• If you look at the overall IPO subscription movement on the last day of the IOP, it also about moved from 8.13X to 33.00X. This was after the IPO remaining open for subscription for a full 4 days in the primary market.

With the IPO closed for subscription at the end of December 04th, 2023, the next piece of action shifts to the finalization of the basis of allotment and later to the listing of the IPO. The basis of allotment will be finalized on 08th December 2023 while the refunds would be initiated on 11th December 2023. The shares of Marinetrans India Ltd (ISIN - INE0P1P01017) would be credited to the demat accounts of eligible shareholders by the close of 12th December 2023 while the stock of Marinetrans India Ltd is expected to be listed on 13th December 2023. The listing will happen on the NSE SME segment for small companies, which is distinct from the regular mainboard IPO space.