In a first, SME IPO gets anchor boost

Mumbai: In a first for the Indian market, on Tuesday an SME IPO attracted anchor investors. Domestic lender Yes Bank and a fund managed by global financial major HSBC invested nearly Rs 12.1 crore in the Rs 43-crore IPO for Navi Mumbai-based One Point One Solutions. The IPO will open for subscription on Wednesday.
Just days before the launch of the IPO, former StanC Bank Asia chief Jaspal Bindra along with his business partner Chandir Gidwani, chief of Centrum Group, had together invested Rs 50 lakh in One Point One to buy a 0.8% stake.According to data from the merchant banker to the issue, HSBC Midcap Equity Fund bought 9.42 lakh shares of the company at Rs 67 each, aggregating Rs 6.3 crore, while Yes Bank bought 9.4 lakh shares at nearly Rs 6.3 crore.
“This is a major milestone for SME capital market at large,” said Mahavir Lunawat, MD, Pantomath Capital Advisors, and the lead manager to the One Point One IPO. “SMEs come up with IPOs at attractive valuations at an early stage of their business cycle with high growth potentials. That’s one of the main reasons SMEs are attracting interest from large fund houses, besides portfolio managers and ultra HNIs (high net worth individuals),” Lunawat said. Yoda Strategic Advisory, a New-Age consultant is the adviser to the company.
Of late, SME IPOs have been attracting strong investor interest. In late November, the IPO for refrigeration solutions company Ice Make Refrigeration was subscribed 261 times as the Rs 23.7-crore initial offer closed with a book size of nearly Rs 6,200 crore. And in early November, the Rs 25-crore IPO for ANI Integrated Services was oversubscribed nearly 200 times, generating a demand worth almost Rs 5,000 crore.