The initial public offer of the Ahmedabad-based kraft paper manufacturer Astron Paper and Board Mills was subscribed 243.20 times on the last day of bidding on Wednesday.
The issue received bids amounting to 340.6-crore shares as against the size of 1.4-crore shares implying subscription of 243.20 times. Notably, the retail investors bid for a total of 36.27-crore shares as against 46.5-lakh shares reserved for them imply demand of more than 77 times.
While this may seem staggering, the non-institutional category saw the highest demand, as investors bid for a total of 290.3 crore shares as against 73.15 lakh shares reserved for them implying a subscription of nearly 400 times. QIB category too registered a heavy demand as investors bid for a total of 13.7 crore shares implying a subscription of more than 103 times. Comparatively, the employee portion posted the least demand as investors from the category bid for a total of 2.7 times the total shares reserved for them.
The public offer consisted of a fresh issue of 1,40,00,000 equity shares of face value of Rs 10 each to raise up to Rs 70-crore. The issue also comprised of reservation of up to 7,00,000 equity shares for subscription by eligible employees. The company had fixed a price band of Rs 45-50 per equity share for the public offer. Post issue, the promoter share is seen reducing to 43.8%. The issue opened on Friday, and today was the last day of the offer.
Astron Paper is engaged in manufacturing of kraft paper and plans to utilise the net proceeds from the IPO towards setting up of an additional facility for manufacturing of kraft paper with lower grammage ranging from 80 to 180gsm and lower Burst Factor ranging from 12-20 BF. Also, the company plans to part repay unsecured loan amounting to Rs 8.1 crore and provide funding for the working capital requirements besides the general corporate purposes.
Astron Paper registered a turnover of Rs 184-crore for the year 2016-17, up 20 per cent from the previous year. The net profit for the year stood at Rs 9.95-crore.