India’s biggest initial public offering is entering its final hours. The Jio IPO, Jio Platforms’ Rs 30,213-crore share sale, closes for subscription today, October 23, after drawing bids worth Rs 1.23 lakh crore on the second day of bidding alone.
By 7 pm on Day 2, October 22, the Jio IPO was subscribed 5.57 times, with bids for 1.10 billion shares against 197.5 million shares on offer, The Economic Times reported. At the upper end of the Rs 1,065 to Rs 1,119 price band, Wednesday’s bids alone were valued at about Rs 1.23 lakh crore.
Total demand, including the anchor book and the first two days of public bidding, stood at about Rs 3.73 lakh crore, Moneycontrol reported. The issue opened on October 21 and was fully subscribed within 100 minutes on Day 1, the fastest full subscription for a mega public issue in India.
Wednesday’s Rs 1.23 lakh crore of bids alone was more than four times the Rs 30,213-crore issue size, and total demand of about Rs 3.73 lakh crore works out to more than twelve times the shares on offer. Based on available figures, the demand makes the Jio IPO the highest-value bid among Indian IPOs that raised more than Rs 15,000 crore, Moneycontrol reported.
With the issue subscribed 5.57 times at the Day-2 close, investors in the oversubscribed categories will get only a fraction of the shares they applied for, with allotment done on a proportional basis. The price band was set at Rs 1,065 to Rs 1,119 per share.
Jio IPO subscription across investor categories
Qualified institutional buyers led the bidding. The QIB portion was subscribed 13.29 times, with bids for 65.14 crore shares against 4.9 crore shares on offer, Moneycontrol reported. More than half of the 1.10 billion shares bid on Day 2 came from this single category.
Non-institutional investors subscribed their portion 5.97 times. Retail participation was more restrained: the retail portion was subscribed 1.54 times, with bids for 13.09 crore shares against 8.5 crore shares reserved for the category. The portions set aside for employees and existing shareholders were subscribed 2.10 times and 4.04 times, respectively. The retail book, at 1.54 times, was the softest of the categories, but with 13.09 crore shares bid against 8.5 crore reserved, retail investors still put in sizeable demand. The headline number was always going to be driven by institutions.
Final-day bidding in large Indian IPOs often sees a late surge as investors who waited on the sidelines enter their bids. The closing tally, due this evening, will show whether that pattern held.
The 5.57-times figure is a Day-2 snapshot taken at 7 pm. Subscription tallies for large issues usually climb through the final day as last-minute bids come in, and the final number will be known by this evening.
Jio IPO anchor book drew bids of over Rs 2.5 lakh crore
Before the public issue opened, the Rs 8,110-crore anchor book had drawn bids of more than Rs 2.5 lakh crore, Business Today reported. BlackRock, Fidelity, Capital Group, Allianz and the Abu Dhabi Investment Authority were among the investors who took part.
The anchor list includes some of the world’s largest asset managers, and their early participation gave the Jio IPO a firm base before public bidding began on October 21. Anchor investors are allotted shares a day before the public issue opens and typically agree to hold them for a set period, which gives the listing a stable early shareholder base.
Jio IPO listing date and the leveraged bets behind it
In a rare move for an Indian public issue, SBI Securities is financing as much as 60 per cent of the amount needed to apply for the Jio IPO, through its parent State Bank of India, Moneycontrol reported. Investors can seek funding for applications of Rs 5 lakh to Rs 10 lakh, with the shares allotted held as collateral.
Several other brokerages are also approaching clients directly with financing options, according to people familiar with the matter. Leveraged application funding of this kind is uncommon in India, and the contest among brokers to fund Jio IPO applications shows how much demand the issue has generated.
The Jio IPO closes for subscription today, October 23. The shares are expected to list on October 28.