Precision Camshafts Ltd has allotted 66.16 lakh shares to six anchor investors ahead of its initial public offer that opens for subscription on Wednesday. The shares have been allotted at a price of Rs 186 per share aggregating to approximately Rs 123 crore.
According to a statement issued by the company, the list of investors that were allotted shares include SBI Mutual Fund, HDFC Mutual Fund, ICICI Prudential Mutual Fund, IDFC Mutual Fund, Birla Sunlife Mutual Fund, and Canara Robeco Mutual Fund.
SBI MF and IDFC MF were allotted the maximum number of shares – 17.74 lakh shares each — among the anchor portion. The allocation made to each of the two fund houses represents 26.8 per cent of the overall anchor portion.
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This is the concept of anchor investors: companies that plan to launch their initial public offer (IPO) are allowed to allot shares to institutional investors ahead of opening the offer to the general public. Such allotment called anchor allocation is done to institutional entities like foreign institutional investors (FIIs), mutual funds, banks, insurance companies, and corporate bodies.
The IPO of Precision Camshafts will open for subscription between January 27 and 29. The company has fixed a price band between Rs 180 and Rs 186 for the offer. If the shares are allotted at the top end of the price band, then the company would raise a total of Rs 410 crore from the IPO.
The Solapur-based company manufactures more than 150 varieties of camshafts that are used in the automobile industry. The company plans to use the proceeds of the IPO to set up a machine shop for ductile iron camshafts at the export oriented unit (EOU) in Solapur, Maharashtra. While the new plant is expected to cost Rs 200 crore, the rest of the proceeds would be used for general corporate purposes. India Infoline, SBI Capital Markets, and HDFC Bank are the book-running lead managers to the issue.
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IPO of Precision Camshafts will
open for subscription between January 27 and 29