Godavari Biorefineries IPO Day 2: Issue Subscribed 47% So Far, GMP At Rs 25

Godavari Biorefineries Ltd.'s Rs 554.8-crore initial public offering was subscribed 47% so far on its second day of subscription on Thursday. The IPO consists of a fresh issue of 92 lakh shares worth Rs 325 crore and an offer for sale of 65 lakh shares worth Rs 229.8 crore. The GMP of Godavari Biorefineries was Rs 25 as of 6:03 a.m. on Oct. 24, according to Chittorgarh's unit InvestorGain.

The price band is set at Rs 334 to Rs 352 per share. Retail investors can apply for a minimum lot size of 42 shares, bringing the total investment per application to Rs 14,784.

The subscription period runs from Wednesday to Friday. Ahead of the IPO, the company raised Rs 166.4 crore from anchor investors, allotting 47.3 lakh shares at Rs 352 each to 19 anchor investors. ICICI Prudential ELSS Tax Saver Fund and 360 One Equity Opportunity Fund received the largest allocation of 11.33%.

The company's shares are expected to list on the mainboard exchanges on Oct. 30.

• Issue opens: Oct 23.

• Issue closes: Oct 25.

• Issue price: Rs 334 to Rs 352 per share.

• Fresh issue: Rs 325 crore.

• Offer for sale: Rs 230 crore.

• Total issue size: Rs 554.70 crore.

• Bid lot: 42 shares.

• Listing: BSE and NSE.

The Mumbai-based company manufactures ethanol-based chemicals and is an integrated bio-refinery with an installed capacity of 570 kilo-liter per day for manufacturing ethanol as of June. According to the red herring prospectus, the company is one of India’s largest producers of ethanol in terms of volume as of March.

Its portfolio comprises of bio-based chemicals, sugar, different grades of ethanol and power. Products of the company find application in a range of industries such as food, beverages, pharmaceuticals, flavours and fragrances, power, fuel, personal care and cosmetics.

The company will not be receiving any of the proceeds from the offer for sale component.

Net proceeds from the fresh issue will go into repaying or pre-payment of outstanding borrowings amounting to Rs 240 crore and general corporate purposes.

The Godavari Biorefineries IPO has been subscribed 0.47 times as of 02:03 p.m.

• Qualified institutional buyers: Nil.

• Non-institutional investors: 0.21 times.

• Retail investors: 0.85 times.

The grey market premium of Godavari Biorefineries was Rs 25 as of 12:53 p.m. on Oct. 24, according to Chittorgarh's unit InvestorGain. The estimated listing price based on the GMP is Rs 377 per share, indicating a likely 7.1% premium over the upper end of the price band.

GMP is not an official price quote for the stock and is based on speculation. 

Disclaimer: Investments in initial public offerings are subject to market risks. Please consult with financial advisors and read the red herring prospectus thoroughly before placing bids.