The non-banking finance company, Northern Arc Capital Ltd, has hit the jackpot with its initial public offering (IPO). On the final day of their share sale this Thursday, they saw an overwhelming response, with their IPO being subscribed 110.71 times!
An astounding number of shares were bid for, totaling 23,77,94,639 against the 2,14,78,290 on offer. These figures were provided by NSE data. This booming demand showcases the trust and interest investors have in this Chennai-based company’s future.
The Breakdown: Who Showed the Most Interest?
Here’s a closer look at the numbers of Northern Arc Capital IPO:
Qualified Institutional Buyers (QIBs)
QIBs almost led the charge with a subscription rate standing at a staggering 240.79 times. This includes banks, investment funds, and other large financial entities showcasing huge confidence.
Non-Institutional Investors
Not far behind, non-institutional investors (generally larger individual or private firms) subscribed to the offer 142.28 times. Their participation underscores a robust belief in Northern Arc’s growth trajectory.
Retail Individual Investors (RIIs)
Finally, the small investors didn’t stay back either. Retail investors subscribed to the IPO 30.74 times, demonstrating their eagerness to be part of this financial journey.
In a statement released on Friday, Northern Arc Capital revealed they raised Rs 229 crore from anchor investors. The share price for the IPO was set between Rs 249 and Rs 263 per share, with total sales valued at Rs 777 crore.
The Northern Arc Capital IPO Details
Let’s dig deeper into the specifics of the IPO:
IPO Breakdown
The IPO includes a fresh issue of equity shares worth Rs 500 crore. Alongside this, there’s an offer for sale (OFS) amounting to 1,05,32,320 equity shares, valued at Rs 277 crore at the higher end of the price band, by the shareholder investors. All combined, the total issue size reaches Rs 777 crore.
Usage of Funds
The capital raised from the fresh equity issue will fuel the company’s future needs, specifically aimed at onward lending. This will enhance Northern Arc’s capacity to provide financial support to those in need.
About Northern Arc
Northern Arc Capital is registered with the Reserve Bank of India (RBI) as a systemically important non-deposit-taking non-banking financial company (NBFC). Operating chiefly in the financial inclusion space, they’ve made impressive strides over the past decade.
They have a diversified business setup, providing credit access to underserved households and businesses through various products, sectors, and geographical locations. They often work hand-in-hand with originator partners to ensure greater financial coverage.
Leading Players Behind the IPO
To manage this colossal IPO, Northern Arc enlisted ICICI Securities, Axis Capital, and Citigroup Global Markets India. These book-running lead managers ensured the IPO’s smooth execution and enormous success.
In Conclusion
To sum it up, the overwhelming subscription of Northern Arc Capital Ltd’s IPO is a testament to the company’s strong reputation and investors’ confidence in its future. This success strengthens Northern Arc’s position in the market, providing them with the necessary capital to cater to their future lending needs. As they continue to operate in the diverse NBFC sector, the company is poised to make significant strides toward financial inclusivity in the country.
The entire financial community will undoubtedly keep a keen eye on Northern Arc as they deploy these fresh funds to expand their reach. It’s a thrilling time for both the company and its investors!
