Netweb Technologies India IPO subscribed 90.36 times at close

Netweb Technologies India IPO worth ₹631 crore, consisted of a fresh issue of ₹206 crore and an offer for sale of ₹425 crore. The IPO saw fairly steady response on Day-1 and Day-2 of the IPO and closed with very healthy subscription numbers at the close of Day-3. In fact, the company got fully subscribed on the first day of the IPO itself. As per the combined bid details put out by the BSE at the close of Day-3, Netweb Technologies India Ltd IPO was subscribed at 90.36X overall, with best demand coming from the QIB segment, followed by the HNI / NII segment and the retail segment in that order. In fact, institutional segment saw some very good traction on the last day of the IPO. The HNI portion also did very well and it saw a surge of corporate and funding applications coming on the last day of the IPO. Retail portion also got oversubscribed. Here are the details of the overall quota allotted to each of the categories ahead of the IPO, post the completion of the anchor issue.

Macro picture of bids received

As of close of 19th July 2023, out of the 88.59 lakh shares on offer in the IPO, Netweb Technologies India IPO saw bids for 8,004.48 lakh shares. This implies an overall subscription of 90.36X. The granular break-up of subscriptions was in favour of the QIB investors followed by the HNI / NII investors while the retail portion got the lowest level of oversubscription among the various categories. 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 and the HNI / NII bids. Even the NII bids hardly (mainly corporate and funding applications) picked momentum on the last day and added to its heft of the previous days.

Netweb Technologies India Ltd IPO Subscription Day-3

QIB Portion subscription details

Let us first talk about the pre-IPO anchor placement. On 14th July 2023, Netweb Technologies India Ltd did an anchor placement with 29.95% of the IPO size getting absorbed by the anchors. Out of the 1,26,20,000 shares on offer, the anchors picked up 37,80,300 shares accounting for 29.95% of the total IPO size. The anchor placement reporting was made to the BSE late on Friday 14th July 2023. The IPO of Netweb Technologies India Ltd opened on 17th July 2023 in the price band of ₹475 to ₹500 and closed for subscription on 19th July 2023 (both days inclusive). The entire anchor allocation was made at the upper price band of ₹500. Here are the details of the anchor allocation made where the individual allocation was more than 2.5%.

Data Source: BSE Filings

The QIB portion (net of anchor allocation as explained above) has a quota of 24.30 lakh shares of which it has got bids for 5,561.86 lakh shares at the close of Day-3, implying a subscription ratio of 228.91X 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 Netweb Technologies India Ltd IPO subscription overall, the actual demand did turn to be quite robust for the IPO.

HNI / NII Portion

The HNI portion got subscribed 81.81X (getting applications for 1,572.86 lakh shares against the quota of 19.23 lakh shares). Bulk of the oversubscription came on the 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 what was exactly visible as the overall HNI / NII portion added to its heft on the last day. However, the HNI portion saw very attractive build-up of subscription.

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 86.79X while the below ₹10 lakh bid category (S-HNIs) got subscribed 71.83X. This is just for information and is already part of the overall HNI bids explained in the previous para.

Retail Individuals

The retail portion was subscribed just 19.15X at the close of Day-3, showing very strong retail appetite. It must be noted that retail allocation is 35% in this IPO. For retail investors; out of the 44.86 lakh shares on offer, valid bids were received for 859.14 lakh shares, which included bids for 733.82 lakh shares at the cut-off price. The IPO is priced in the band of (₹475 to ₹500) and has closed for subscription as of the close of Wednesday, 19th July 2023.