Plada Infotech Services IPO Subscribed at 57.85 times

About the Plada Infotech Services IPO

The IPO of Plada Infotech Services Ltd opened for subscription on 29th September 2023 and closes for subscription on 05th October 2023. The IPO was kept open for 4 days in all. The stock of Plada Infotech Services Ltd has a face value of ₹10 per share and it is a fixed price issue, priced at ₹48 per share. The IPO of Plada Infotech Services Ltd has only a fresh issue component and no offer for sale (OFS) component in the IPO. As part of the fresh issue portion of the IPO, Plada Infotech Services Ltd will issue a total of 25,74,000 shares (25.74 lakh shares). At the fixed IPO price of ₹48 per share, the total value of the fresh issue portion aggregates to ₹12.36 crore. Since there is no offer for sale portion, the fresh issue will also be the total size of the issue. Therefore, the total issue size of Plada Infotech Services Ltd will also entail the issue of 25,74,000 shares (25.74 lakh shares) worth ₹12.36 crore.

The minimum lot size for the IPO investment will be 3,000 shares. Thus, retail investors can invest a minimum of ₹144,000 (3,000 x ₹48 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 6,000 shares and having a minimum lot value of ₹288,000. There is no upper limit on what the QIBs as well as what the HNI / NII investors can apply for. The company has been promoted by Shailesh Kumar Damani and Anil Mahendra Kotak and the promoter quota will get diluted post the IPO from 89.50% to 62.64%. The company will use the IPO funds to purchase laptops and accessories for IT development, repayment of loans  and working capital funding; apart from general corporate purposes. Indorient Financial Services Ltd will be the lead manager to the issue and Bigshare Services Private Ltd will be the registrar to the issue. The market maker for the issue will be Nikunj Stock Brokers Ltd.

Final subscription status of Plada Infotech Services Ltd

Here is the subscription status of the Plada Infotech Services IPO as at close on 05th October 2023.

As can be seen from the above table, the overall IPO of Plada Infotech Services Ltd got subscribed a healthy 57.85 times. The retail portion led the stakes with 73.78 times subscription, followed by the HNI / NII portion at 39.81 times. 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 HNI / NIIs. There was a broad quota designed for each of the segments viz. the retail and the HNI / NII segments. The table below captures the allocation reservation done for each of the categories out of the total number of shares offered in the IPO. A total of 1,29,000 shares were allocated as market maker portion to Nikunj Stock Brokers Ltd, which will act as a market maker 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 IPO of Plada Infotech Services Ltd does not have any QIB quota and has also not set aside any shares for anchor allocation prior to the issue. As can be seen, from the above table, the company had allocated 1.29 lakh shares or 5.01% of the original issue size to the market maker. The net offer (net of the anchor allocation) was equally distributed between the retail investors and the non-retail investors or HNI / NII investors.

How subscription built up for the IPO of Plada Infotech Services Ltd

The oversubscription of the IPO was dominated by the retail category followed by the HNI / NII category in that order. The table below captures the day-wise progression of the subscription status of Plada Infotech Services Ltd IPO. The IPO was open for 4 days.

It is clear from the above table that the retail category got fully subscribed on the first day of the IPO. In fact, the IPO was kept open for a period of 4 days. While the retail portion got fully subscribed on the first day of the IPO, the HNI / NII portion got fully subscribed only on the second day of the IPO. Overall, the IPO got just about fully subscribed at the close of the first day of the IPO. However, all the 3 categories saw bunching of flows on the last day of the IPO; which was the fourth day. The overall IPO was fully subscribed on the first day itself of the IPO although most of the traction came on the last day.

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 09th October 2023 while the stock is expected to be listed on 12th October 2023. The listing will happen on the NSE SME segment for small companies, which is in contrast to the mainboard IPO space.