After weak listing of Sula Vineyards, two new entrants - Landmark Cars, Aban Holdings – also made tepid debut on Dalal Street on Friday, thanks to negative equity market sentiments and muted response to their initial public offerings (IPOs), especially from retail investors. Shares of Landmark Cars and Aban Holdings tumbled up to 19% in the first hour of trade, in sync with the broader market, with the BSE Sensex and NSE Nifty falling 1% each. Sula Vineyards, the country’s largest wine producer, also continued its losing streak for the second day after falling 7% on its debut on Thursday.
Shares of Landmark Cars listed at a discount of 6.9% at ₹471 on the National Stock Exchange (NSE), against its issue price of ₹506. The stock of the automobile services provider opened at ₹471.30 on the Bombay Stock Exchange (BSE). Post listing, Landmark Cars share price declined as much as 11.8% to hit a low of ₹446.45, while the market capitalisation dropped to ₹1,820.5 crore.
Similarly, Aban Holdings also failed to impress investors, with the share price opening a tad higher at ₹273 on the NSE, compared with the issue price of ₹270. The stock, however, soon gained momentum and plunged as much as 19.1% to touch a low of ₹218.65. The market capitalisation of Aban Group-backed financial services provider stood at ₹1,152.8 crore.
Landmark Cars raises ₹552 crore via IPO
The automobile services provider raised ₹552 crore via the public issue, which opened between December 12-15. The offer comprises fresh issue of ₹150 crore equity shares, whereas existing shareholders and promoters will sell shares worth ₹402 crore via OFS. The fund from fresh issue plans will be utilised for pre-payment of borrowings availed by its subsidiaries and meet general corporate purposes.
The issue had a price band of ₹481-₹506 per share. The company has reserved 50% of the IPO size for QIBs, 35% for retail investors, and the remaining 15% for non-institutional investors.
The IPO was subscribed 3.06% as it garnered bids for 2.46 crore shares against the issue size of 80.41 lakh shares, led by qualified institutional investors. The quota reserved for qualified institutional buyers was subscribed 8.7% times, while portions set aside for retail investors and non-institutional buyers received 0.59% and 1.32% bids.
Formed in 1998, Landmark Cars is the leading premium automotive retail business in India with dealerships for Mercedes-Benz, Honda, Jeep, Volkswagen and Renault. It also caters to the commercial vehicle retail business of Ashok Leyland in India. The company offers services such as selling new vehicles and after-sales servicing and repairing, which includes selling spare parts, lubricants and other products. Besides, it sells pre-owned passenger vehicles and provides third-party finance and insurance products.
Aban Holdings garners ₹345.60 cr
Aban Group-backed financial services provider launched its four-day IPO between December 12-15 to raise ₹345.60 crore. The Mumbai-based company has fixed a price band of ₹256-₹270 per share for the issue.
The IPO was a mixture of fresh equity shares and OFS by existing shareholders. The issue includes a fresh issue of 38 lakh equity shares worth ₹102.6 crore and OFS of nearly 90 lakh shares valued at around ₹243 crore. Promoter Abhishek Bansal offloaded his shareholder in the OFS.
The issue received weak responses from investors, with the IPO just subscribing 1.1 times. The public issue was booked 0.40 times in the retail category, 4.10 times in QIB, and 1.48 times in the NII category.
The company intends to use IPO capital raised from the fresh issue of equity shares to invest in its NBFC subsidiary, Aban Finance for financing the augmentation of its capital base to meet its future capital requirements. A part of the capital will be also utilised to meet general corporate purposes.
Incorporated in 2009, Abans Holdings provides NBFC services, global institutional trading in equities, commodities and foreign exchange, private client stock broking, depositary services, asset management services, investment advisory services and wealth management services to corporates, institutional and high net worth clients.