Committed Cargo Care IPO Final Subscribed 86.98 times

About the Committed Cargo Care IPO

The IPO of Committed Cargo Care Ltd opened for subscription on 06th October 2023 and closed for subscription on 10th October 2023; both days inclusive. It has a face value of ₹10 per share and it is a fixed price issue with the IPO price fixed at ₹77 per share. The IPO of Committed Cargo Care Ltd has only a fresh issue component with no book built portion. The fresh issue portion will entail the issue of 32,44,000 shares (32.44 lakhs), which at the fixed IPO price of ₹77 per share aggregates to a total fresh fund raising of ₹24.98 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 total IPO size will also comprise of 32.44 lakh shares, which at the fixed IPO price of ₹77 per share will aggregate to a total IPO size of ₹24.98 crore.

The minimum lot size for the IPO investment will be 1,600 shares. Thus, retail investors can invest a minimum of ₹123,200 (1,600 x ₹77 per share) in the IPO. That is also the maximum that retail investors can invest in the IPO. HNI / NII investors can invest a minimum of 2 lots comprising of 3,200 shares with a minimum lot value of ₹246,400. There is no upper limit on what the QIBs and HNI / NII investors can apply for. Committed Care Cargo Ltd has allocated 1,64,800 shares as market maker inventory and Nikunj Stock Brokers Ltd has been appointed as the market maker to provide post listing liquidity. Post the IPO, the promoter stake will be diluted from 98.00% to 68.63%. The fresh funds will be used for working capital and for general corporate expenses. Fedex Securities Private Ltd will be the lead manager to the issue and Bigshare Services Private Ltd will be the registrar to the issue.

Final subscription status of Committed Cargo Care IPO

Here is subscription status of Committed Cargo Care IPO as at close on 10th October 2023.

As can be seen from the above table, the overall IPO of Committed Cargo Care IPO got subscribed an impressive 86.98 times at the close of subscription. The HNI / NII portion led the stakes with 94.03 times subscription, followed by the Retail portion at 77.30 times subscription. That is a very strong response to an SME IPO, especially if you consider the median subscriptions that similar other SME IPOs have got in the past.

Allocation quota for various categories

The issue was open for retail investors, and for the non-institutional investors, predominantly comprising of the HNI / NIIs. There was a broad quota designed for each of the segments viz. the retail and the HNI / NII. A total of 1,64,800 shares were allocated as market maker portion to Nikunj Stock Brokers Ltd, 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.

As can be seen, from the above table, the company had allocated 1.648 lakh shares or 5.08% of the original issue size to the market maker quota. There is no anchor allocation and no separate QIB quota in this IPO. The net offer to the public (net of the market maker quota) was equally divided between the retail investors and the HNI / NII investors.

How subscription built up for the IPO of Committed Cargo Care Ltd

The oversubscription of the IPO was dominated by the HNI / NII category followed closely by the Retail investors in that order. The table below captures the day-wise progression of the subscription status of Committed Cargo Care Ltd IPO. The IPO was open for 3 days.

It is clear from the above table that while the retail portion got fully subscribed on the first day of the IPO itself, the NII portion got subscribed only on the second day of the IPO. In fact, the overall IPO had got subscribed fully on the first day of the IPO itself due to the strong response from the retail investors on the first da. However, both the categories of investors viz. retail investors and the HNI / NII investors saw bunching of flows on the last day of the IPO. The overall IPO was fully subscribed on the first day of the IPO although most of the traction came on the last day. That is quite normal in most of the SME IPOs.

All the 3 categories of investors viz., HNIs / NIIs, retail and QIB categories saw good traction and build-up of interest on the last day of the IPO.  Post the IPO listing, the market maker will offer two way quotes on the stock, using the inventory of shares, and ensure that investors do not have to worry about liquidity and basis risk. The basis of allotment will be finalized on 13th October 2023 while the stock is expected to be listed on 18th October 2023. The listing will happen on the NSE SME segment for small companies, which is in contrast to the mainboard IPO space.