Australian Premium Solar IPO Subscribed 464.16 times

About the Australian Premium Solar IPO

Australian Premium Solar IPO has a face value of ₹10 per share and it is a book built issue, priced in the band of ₹51 to ₹54 per share. The final price of the IPO will be decided within this price band. Australian Premium Solar IPO has only a fresh issue component and no offer for sale (OFS) portion. As part of the fresh issue portion, Australian Premium Solar (India) Ltd will issue a total of 52,00,000 shares (52.00 lakh shares), which at the upper band of the price band of ₹54 per share aggregates to fresh fund raising of ₹28.08 crore. Since there is no offer for sale (OFS) portion, the fresh issue size will also double up as the overall IPO size. Therefore, the overall IPO size will comprise of the issue of 52,00,000 shares at the price of ₹54 and the overall IPO size will be ₹28.08 crore.

Like every SME IPO, this issue also has a market making portion with a market maker inventory allocation of 2,60,000 shares. Spread X Securities Private Ltd will be the market maker to the issue. The market maker will provide two-way quotes to ensure liquidity on the counter and low basis costs, post listing. Post the IPO, the promoter stake in Australian Premium Solar (India) Ltd will dilute from 99.98% to 73.64%. The funds will be used for capex and working capital needs. Beeline Capital Advisors Private Ltd will be the lead manager to the issue, and Link Intime India Private Ltd will be the registrar to the IPO.

Final subscription status of Australian Premium Solar IPO

Here is the subscription status of the Australian Premium Solar (India) IPO as at close on 15th January 2024.

As can be seen from the above table, the overall IPO of Australian Premium Solar (India) Ltd got subscribed an impressive 464.16 times as of the close of subscription on 15th January 2024. The HNI / NII portion led the stakes with 772.85 times subscription, followed by the Retail portion at 535.73 times subscription. The QIB portion of the IPO also got a healthy subscription of 107.02 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 QIBs, retail investors and the HNI / NII investors. There was a broad quota designed for each of the segments viz. the retail, QIB and the HNI / NII segments. A total of 2,60,000 shares were allocated as market maker portion to Spread X 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 Australian Premium Solar (India) Ltd, the anchor allocation of 14,80,000 shares was carved out of the QIB portion, as a result of which the QIB offer to the public reduced from the original 47.46% of the issue size to 19.00% of the issue size. The anchor allocation bidding opened on January 10th, 2024 and also closed on the same day. A total of 14,80,000 shares were allocated across 3 anchor investors. The anchor allocation was done at the upper end of the IPO price band of ₹54 per share (which includes face value of ₹10 per share and premium of ₹44 per share).

The total anchor allocation value was worth ₹7.99 crore. The anchor allottees included NAV Capital VCC – NAV Capital Emerging Star Fund (32.43%), Rajasthan Global Securities Private ltd (33.78%), and LSRD Securities Private Ltd (33.78%). These 3 anchor investors accounted for the entire 100% of the anchor allocation. Out of the anchor shares allocated to investors on January 10th, 2024, a lock in of 30 days will be applicable for 50% of the shares (up to February 28, 2024) and a lock-in of 90 days will be applicable for the remaining shares (up to May 30, 2024). Here, it must be noted that, the allocation of market maker inventory of 5.00% to Spread X Securities Private Ltd is outside the anchor portion.

How subscription built up for the Australian Premium Solar IPO?

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 Australian Premium Solar (India) 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 Australian Premium Solar (India) Ltd.

• The HNI / NII portion got the best subscription in the Australian Premium Solar (India) Ltd IPO at 772.85 times and it got 19.61 times subscribed on the first day of the IPO itself.
   
• The Retail portion was behind the HNI / NII portion in terms of subscription at 535.73 times overall and it got 45.20 times subscribed at the end of the first day.
   
• The QIB portion was third in the pecking order in terms of subscription at 107.02 times overall and it got just 0.07 times subscribed at the end of the first day.
   
• While the retail and HNI / NII portion got fully subscribed on the first day of the IPO itself, the QIB portion got fully subscribed only on the second day of the IPO. However, due to the retail and HNI / NII portion, overall issue got subscribed fully on Day-1 itself.
   
• As a result, the overall subscription for the IPO across categories closed on the third and final day at 464.16 times and it got subscribed 26.82 times at the close of the first day.
   
• 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 55.59X to 772.85X on the last day of the IPO. Even the retail portion saw the total subscription ratio move from 114.20X to 535.73X 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 5.62X to 107.02X on the last day of the IPO. Finally, regarding the overall IPO subscription ratio, it also moved from 70.63X to 464.16X on the last day of the IPO.

Overall, the IPO of Australian Premium Solar (India) Ltd has seen very good traction across various categories of investors. The strong investor interest on the first day itself, shows the colour of the response to the IPO. It has been very positive and robust.

Next steps after the closure of the Australian Premium Solar IPO

Australian Premium Solar (India) IPO has already closed for subscription on 15th January 2024.  The question is now what are the next steps in the IPO process for this stock? First and foremost, the basis of allotment will be finalized on 16th January 2024, which puts out the allocation logic and the ratios of allocation to different categories. Then the refunds will be initiated on 17th January 2024 to non-allottees and to others to the extent of application amount not allotted. In case of ASBA, it is about releasing the lien.

The demat credits are also expected to happen on 17th January 2024 and the stock is scheduled to list on 18th January 2024 on the NSE SME segment. This is the segment, in contrast to the mainboard, where IPOs of small and medium enterprises (SMEs) are incubated. The demat credits to the demat account to the extent of allotment will happen by the close of 17th January 2024 under ISIN Number (INE0P0001010).