March may see companies raising up to Rs 6,000 crore via IPOs

MUMBAI: At least half a dozen companies are set to raise Rs 6,000 crore in March or early April through initial public offerings (IPOs) in what would be the second best month for IPOs in last six-and-a-half years. The IPOs to be launched are Music Broadcast, Avenue Supermart, Central Depository Services, S Chand & Co, Continental Warehousing Corporation, Security and Intelligence Services, Housing and Urban Development Corporation and Shankara Building Products, said bankers.

"Unless results of UP elections are a complete shocker and contrary to popular perception, given the liquidity in the economy, the equity markets should continue to stay on course and all IPOs and QIPs being planned for March and April should be well received," said Atul Mehra, MD, investment banking, JM Financials.

Apart from the above, NSE, GoAir, SBI Life Insurance, Aster DM Healthcare, Hinduja Leyland Finance, IRB InvIT Fund and Cent Bank Home Finance (CBHFL) are among other two dozen companies likely in the IPO pipeline for 2017.

This year's first IPO for the BSE was oversubscribed 51 times last month. The issue, which opened on January 23, raised up to Rs 1,243 crore from the IPO priced at Rs 805-806 per share. Investment bankers said that there is a huge demand for new issuances from domestic investors.

"Not only retail but also institutional investors, mainly mutual funds, sitting on cash, are waiting for good companies to invest," said Dara Kalyaniwala, senior V P-investment banking at Prabhudas Lilladher. "Most of the listed companies are currently over or fairly valued and only new offerings can give good opportunities.Music Broadcast, the company that runs Radio City FM channel, will launch its Rs 500-crore IPO on March 6. The issue will close on March 8 and will be priced in a Rs 324-333 range. Shares in Jagran Prakashan-promoted Radio City are at a premium of Rs 70-75 over the expected issue price in the grey market, said brokers dealing in this unregulated market.

Avenue Supermart, which operates the retail chain under the D-Mart brand, is set to open on March 8 and close on March 10 to raise about Rs 1,800 crore. The issue is likely to be priced in the range of Rs 295-299, said a banker to the issue. Grey market price for Avenue Supermart is between Rs 175 and Rs 180. Shankara Building Products, a retailer of home improvement products, has an IPO in the last week of March to raise Rs 600 crore.

CX Partners-backed Security and Intelligence Services' Rs 1,000-crore IPO is expected to hit primary markets towards March-end or early-April, said bankers. BSE-promoted Central Depository Services is likely to open its IPO in the third week of March to raise about Rs 400 crore, according to bankers. The issue price is expected to be between Rs 115 and Rs 135.

Continental Warehousing Corporation is planning to raise about Rs 420 crore. The issue is likely to open in the last week of March. HUDCO, S Chand & Co.and CL Educate are other IPOs likely to hit the market in March or first half of April, according to bankers.

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