Hindustan Aeronautics IPO fails to gather full subscription on last day despite overbidding by institutions

HAL IPO: The public offer of the state-run defence-PSU Hindustan Aeronautics Ltd (HAL) remain undersubscribed on the last day of subscription despite an overbidding by institutional investors. The public offer of Hindustan Aeronautics was subscribed 98.57% on the third and the last day of bidding followed by the oversubscription from institutional investors. HAL IPO was subscribed about 50% up until 3 pm on Tuesday but in the last couple of hours, the issue gathered pace as QIBs overbid. The initial shares sale HAL was opened on 16 March closed today. The defence PSU Hindustan Aeronautics had expected to raise about Rs 4,229 crore at the upper end of the price band of Rs 1,240. For the total issue size of 3,41,07,525 equity shares, the shares sale has already received bids for as much as 3,36,07,632 equity shares which nearly accounts for 98.57% of the total issued shares, as per the data available with stock exchanges.

The quota blocked for the institutional investors got subscribed 1.729 times; the shares reserved for the non-institutional investors were subscribed 3.31%; the portion set aside for retail investors was subscribed 37.42% while the quantum allocated for the employee category was subscribed 20.45%.

The public offer of Hindustan Aeronautics Ltd is one of the last IPOs out of the government’s disinvestment program of Rs 72,500 crore for the financial year 2017-2018. Tomorrow, another PSU Mishra Dhatu Nigam Ltd is launching its IPO and has expected to raise about Rs 450 crore at the upper end of the price band. In the initial shares sale of HAL, the promoter, GoI (Government of India) is selling about 10% of the paid-up capital via offer for sale route. Hindustan Aeronautics Ltd had offered a discount of Rs 25 per equity shares on the offer price of Rs 1,215 to Rs 1,240 for retail investors and the eligible employees.

Axis Capital Ltd and SBI Capital Markets Ltd were the books running lead managers for the issue of Hindustan Aeronautics and Kary Computershare had been appointed as the registrar to the IPO of Hindustan Aeronautics.