- 50 percent subscribers to the offered shares on the first day.
- IndiaMart becomes the first B2B platform to go for IPO.
IndiaMart InterMesh was subscribed 50 percent on the first day of their Initial Public Offering (IPO) on June 24.
The issue received bids for 13,57,635 equity shares against IPO size of 26,92,824 shares (excluding anchor book portion), as per data available on NSE website.
The offer was divided into 2 categories, one of them the reseed category of qualified institutional buyers has received 76 percent subscription and the retail book has been subscribed 49 percent. There is no major response to non-institutional investors book.
With this, IndiaMart becomes first Indian B2B marketplace to go for IPO. IPO of largest online B2B marketplace for business products and services worth 475 crores will close on June 26.
At this price, the issue demands a valuation multiple of 139.68 times at FY19 EPS of Rs 6.97. The P/B ratio would work out to 17.51 times at FY19 book value of Rs 55.57, which looks unreasonable. (source:- Economic Times)
While brokerages largely have an ‘avoid’ ratings on the issue, a few of them believe the stock could be a good long-term bet.
It is an offer for sale of 48,87,862 shares by its promoters and investors, so the company will not get any proceeds from public issue.
The company has already raised more than Rs 213 crore from 15 anchor investors.
With this IndiaMart becomes the first company to go for IPO in the second tenure of Modi Government. IndiaMart is the first B2B platform to go for IPO. Unlisted firms TradeIndia, Exporters India, Alibaba India, and JD Business are some of the online B2B classified peer platforms of IndiaMART.
Such types of technological and scalable business models should not be valued merely on profitability, but also on future market potential and capabilities of the management to work towards achieving the potential, the brokerage said, assigning a ‘SUBSCRIBE’ rating to the issue.