Tega Industries IPO attracts highest QIB subscription in the last decade: Issue subscribed 219 times
Mumbai: The initial public offering of Tega Industries Limited (“Company”), has achieved the highest subscription from the qualified institutional buyers (QIB) category in a decade. On the last day of subscription, the QIB portion was subscribed 215.45* times. Overall, the issue was oversubscribed by 219.04 times.
QIB portion of HDFC Asset Management Company was subscribed 192.26 times, followed by Indigo Paints 189.57 times, Tatva Chintan 185.23 times, and Mrs. Bectors Food Specialties 176.85 times. Robust QIB category bid indicates money is waiting on the sidelines for quality IPOs since interest in the broader markets seemed less. Brokerage is of the view that QIB interest is higher in new kind of businesses where either there are little or no listed companies in that space.
The offer received bids for 2,09,58,69,600 shares against the offered 95,68,636 equity shares, as per the 5:00 pm data available on the bourses. Retail investors had put in bid 29.44 times the shares reserved for them, while the portion set aside for non-institutional investors was subscribed 666.19 times.
The primary offering was entirely an offer for sale (OFS) shares with a face value of Rs 10 each, in which its existing shareholders and promoters stood to offload 1,36,69,478 equity shares in the range of Rs 443-453 each.
On Tuesday, Tega Industries raised Rs 186 crore from 14 anchor investors, who were allotted 41,00,842 equity shares at the upper price band of Rs 453 per share.
Ashoka India Equity Investment Trust PLC, Goldman Sachs, Kotak Funds – India Midcap Fund, Kuber India Fund, Elara India Opportunities Fund, and BNP Paribas Arbitrage are among the investors that participated in the anchor book.
In addition, shares have been allocated to domestic funds SBI Mutual Fund, ICICI Prudential Mutual Fund, Axis Mutual Fund, HDFC Mutual Fund, Mirae Assets Tax Saver Fund, Aditya Birla Sun Life Trustee Private Limited, Kotal Mutual Fund, and Tata Mutual Fund are among the investors that participated in the anchor book. Axis Capital Limited and JM Financial Limited are the Book Running Lead Managers (“BRLM”) to the offer.
Brokerage Houses like ICICI Direct, Marwadi Share Finance, Choice Equity, Angel Broking, etc. have given recommendations of “Subscribe” to the issue for long-term perspective.
Demand for mill liners is repeating in nature largely due to the wear of mill liners. Copper and gold together accounted for 75% of mill liner market share during 2020, followed by iron ore and other (cement and aggregates) with 25%. The global mill liner market was estimated at $1.73 billion in 2020. Demand of mill liners is higher in replacement against newly installed grinding machines with mill liner in a year. The ratio is expected to be about 70-80% from replacement and 20-30% are in the newly installed machines.
The GDP contribution of the mining and quarrying sector, both in terms of nominal and real GDP, has declined over the last decade. In regards to nominal GDP, the share of mining and quarrying declined from 2.13% in 2015–2016 to 1.75% by 2019–2020; the goal of the government is to raise the share from 1.75% to 2.50%. Miners will have to process more ore to produce the required concentrate. This will, in turn, boost consumables such as mill liners growth in the mineral processing industry. Mill liners can be metallic, rubber, or composite materials.
Tega Industries offers comprehensive solutions to marquee global clients in the mineral beneficiation, mining, and bulk solids handling industry across different stages of mining and mineral processing, screening, grinding, and material handling, including after-market, spending on wear, spare parts, grinding media, and power, which are regular operating expenses for customers.
Globally on the basis of revenues, Tega Industries are the second-largest producer of polymer-based mill liners as of June 30, 2021.
Its product portfolio comprises more than 55 mineral processing and material handling products, that cover a wide range of solutions in the mining equipment, aggregates equipment, and the mineral consumables industry.
Revenue from operations increased 17.62% from Rs 684.85 crore in fiscal 2020 to Rs 805.52 crore in fiscal 2021, primarily attributable to an increase in the sale of products, while its net profit increased from Rs 65.50 crore in fiscal 2020 to Rs 136.41 crore.
* QIB subscription in the last 10 years
| No | Company Name | QIB Portion subscribed (No of times) |
| 1 | Tega Industries Ltd | 215.45 |
| 2 | HDFC Asset Management Company Ltd | 192.26 |
| 3 | Indigo Paints Ltd | 189.57 |
| 4 | Tatva Chintan Pharma Chem Ltd | 185.23 |
| 5 | Mrs. Bectors Food Specialities Ltd | 176.85 |
| 6 | Laxmi Organic Industries Ltd | 175.43 |
| 7 | Amber Enterprises India Ltd | 174.99 |
| 8 | Paras Defence and Space Technologies Ltd | 169.65 |
| 9 | G R Infraprojects Ltd | 168.58 |
| 10 | MTAR Technologies Ltd | 164.99 |
| Source: Chittorgarh.com | ||
TEGA INDUSTRIES LIMITED
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| Sr.No. | Category | No.of shares offered/reserved | No. of shares bid for | No. of times of total meant for the category |
| 1 | Qualified Institutional Buyers (QIBs) | 27,33,896 | 58,90,17,198 | 215.45 |
| 1(a) | Foreign Institutional Investors (FIIs) | – | 14,96,50,380 | – |
| 1(b) | Domestic Financial Institutions(Banks/ Financial Institutions(FIs)/ Insurance Companies) | – | 24,07,17,312 | – |
| 1(c) | Mutual Funds | – | 3,51,75,393 | – |
| 1(D) | Others | – | 16,34,74,113 | – |
| 2 | Non Institutional Investors | 20,50,422 | 1,36,59,78,966 | 666.19 |
| 2(a) | Corporates | – | 16,05,72,324 | – |
| 2(b) | Individuals (Other than RIIs) | – | 1,15,56,65,115 | – |
| 2(c) | Others | – | 4,97,41,527 | – |
| 3 | Retail Individual Investors (RIIs) | 47,84,318 | 14,08,73,436 | 29.44 |
| 3(a) | Cut Off | – | 10,80,13,257 | – |
| 3(b) | Price Bids | – | 3,28,60,179 | – |
| 4 | Employee Reserved | – | – | – |
| 4(a) | Employee (Cut off) | – | – | – |
| 4(b) | Employee (Price) | – | – | – |
| 5 | Reservation PortionShareholder | – | – | – |
| 5(a) | RPS (Cut off) | – | – | – |
| 5(b) | RPS (Price) | – | – | – |
| Total | 95,68,636 | 2,09,58,69,600 | 219.04 | |