Accent Microcell IPO Subscribed 362.28 times

About the Accent Microcell Ltd IPO

The IPO of Accent Microcell Ltd opened for subscription on 08th December 2023 and closed for subscription on 12th December 2023. The stock of Accent Microcell Ltd had a face value of ₹10 per share and it is a book building issue with the price band fixed in the range of ₹133 to ₹140 per share for the IPO. The final price will be discovered within this price band. The IPO of Accent Microcell Ltd only had a fresh issue component with no offer for sale (OFS) portion. As part of the fresh portion of the IPO, Accent Microcell IPO issued a total of 56,00,000 shares (56 lakh shares), which at the upper IPO band price of ₹140 per share aggregates to a total fresh issue size of ₹78.40 crore. Since there is no offer for sale portion, the total size of the fresh issue will also double up as the total size of the IPO. Hence the total IPO size also comprised of 56.00 lakh shares, which at the upper price band of ₹140 per share aggregated to overall issue size of ₹78.40 crore.

The minimum lot size for the IPO investment will be 1,000 shares. Thus, retail investors can invest a minimum of ₹140,000 (1,000 x ₹140 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 2,000 shares and having a minimum lot value of ₹280,000. There is no upper limit on what the QIBs as well as what the HNI / NII investors can apply for. Like every SME IPO, this issue also has a market making portion with a market maker portion allocation of 2,80,000 shares. The market maker for the issue; Prabhat Financial Services Ltd, will provide two-way quotes to ensure liquidity and low basis costs post listing. Post the IPO, the promoter stake in Accent Microcell Ltd gets diluted from 73.13% to 53.67%. Accent Microcell Ltd will use the fresh funds to set up a plant at Navagam Kheda to manufacture croscarmellose sodium (CCS) and sodium starch glycolate. Corporate Capitalventures Private Ltd is the lead manager to the issue, and KFIN Technologies  Ltd is the registrar to the IPO.

Final subscription status of Accent Microcell Ltd

Here is the subscription status of the Accent Microcell Ltd as at close on 12th December 2023.

As can be seen from the above table, the overall IPO of Accent Microcell Ltd got subscribed an impressive 362.28 times. The HNI / NII portion led the stakes with 576.66 times subscription, followed by the Retail portion at 409.71 times subscription. The QIB portion of the IPO also got a healthy subscription of 118.48 times. That is a very strong and 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 strong traction for the IPO across all the three categories of investors; QIB, retail and HNI / NII investors.

Allocation quota for various categories

The issue was open for retail investors and the HNI / NII investors. There was a broad quota designed for each of the segments viz. the retail, and the HNI / NII segments. A total of 2,80,000 shares were allocated as market maker portion to Prabhat Financial Services 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 Accent Microcell Ltd, the anchor allocation of 15,96,000 shares was carved out of the QIB portion, as a result of which the QIB offer to the public reduced from the original 47.50% of the issue size to 19.00% of the issue size. The anchor allocation bidding opened on December 07, 2023 and also closed on the same day. A total of 15,96,000 shares were allocated across 5 anchor investors. The anchor allocation was done at the upper end of the IPO price band of ₹140 per share. The total anchor allocation value was worth ₹22.34 crore. The anchor allottees included Meru Investment Fund (44.80%), Negen Undiscovered Value Fund (18.80%), Zinnia Global Funde (15.66%), Silver Stallion Fund (10.65%), and Vikasa India EIF Fund (10.09%). These 5 anchor investors accounted for the entire 100% of the anchor allocation. Out of the anchor shares allocated to investors on December 07, 2023, a lock in of 30 days will be applicable for 50% of the shares (up to January 25, 2024) and a lock-in of 90 days will be applicable for the remaining shares (up to April 18, 2024). The allocation of market maker inventory of 5.00% is outside the anchor portion.

How subscription built up for the IPO of Accent Microcell Ltd?

The oversubscription of the IPO was dominated by the HNI / NII followed by the Retail category and the QIB category in that order. The table below captures the day-wise progression of the subscription status of Accent Microcell Ltd. The IPO was kept open for 3 working days.

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

• The HNI / NII portion got the best subscription in the Accent Microcell Ltd IPO at 576.66 times and it got 52.78 times subscribed on the first day of the IPO itself.
   
• The Retail portion was behind the HNI / NII portion in terms of subscription at 409.71 terms overall and it got 62.17 times subscribed at the end of the first day.
   
• The QIB portion was third in the pecking order in terms of subscription at 118.48 terms overall and it got 7.12 times subscribed at the end of the first day.
   
• While the QIB, retail and HNI / NII portion getting fully subscribed on the first day of the IPO itself, even the overall subscription was filled up on the first day itself. The overall IPO which saw subscription of 362.28 times also got fully subscribed at 44.43 times at the close of the first day of the IPO itself.
   
• The retail, and HNI / NII portion saw the best traction on the last day of the IPO. The HNI / NII portion saw the total subscription ratio moving from 161.02X to 576.66X on the last day of the IPO. Even the retail portion saw the total subscription ratio move from 218.12X to 409.71X on the last day of the IPO.
   
• The last day traction story was true for QIBs and the overall IPO also. The QIB portion saw the total subscription ratio moving from 9.90X to 118.48X on the last day of the IPO. Finally, regarding the overall IPO subscription ratio, it also moved from 146.39X to 362.28X on the last day of the IPO.

With the IPO closed for subscription at the end of December 12th, 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 13th December 2023 while the refunds would be initiated on 14th December 2023. The shares of Accent Microcell Ltd (ISIN - INE0Q5D01013) would be credited to the demat accounts of eligible shareholders by the close of 14th December 2023 while the stock of Accent Microcell Ltd is expected to be listed on 15th December 2023. The listing will happen on the NSE SME segment for small companies, which is distinct from the regular mainboard IPO space.