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SSG Capital-backed Future Supply IPO covered 7.5 times on final day

08 December, 2017

The logistics arm of Kishore Biyani-led Future Group, Future Supply Chain Solutions Ltd, received strong response to its initial public offering on the third and final day, Friday, with demands from across investor categories.

The SSG Capital-backed company’s public offering of 6.84 million shares, excluding anchor allotment, was covered almost 7.5 times, receiving bids for 51.2 million shares, stock-exchange data showed.

The portion of shares reserved for qualified institutional buyers (QIBs) was covered 12.36 times the 1.95 million shares reserved for them. The retail portion was covered 3.11 times.

The portion set aside for non-institutional investors, comprising corporate bodies and wealthy individuals, was covered 11.41 times.

Future Supply’s IPO was subscribed 31% on the first day on Wednesday, before gaining momentum the following day to touch the three-fourths mark.

On Tuesday, the logistics arm of the Kishore Biyani-led Future Group had raised Rs 195 crore ($30 million) by selling about 2.94 million shares to 13 anchor investors at the upper end of the Rs 660-664 price band. The investors mostly included domestic mutual funds.

The IPO comprises a sale of 9.78 million shares by the promoter entity, Future Enterprises, and Singapore-based distressed assets fund manager SSG Capital. The IPO will result in a 24.42% stake dilution on a post-issue basis. The promoter’s stake will drop to 52.47% from 57.35%, while SSG’s stake will come down to 14.63% from 34.18%.

At the upper end of the band, the selling shareholders will raise Rs 649.69 crore ($100.72 million) at a valuation of Rs 2,660 crore ($412 million).

SSG had sold a 5% stake as part of a pre-IPO round last month, marking the first such liquidity event in its India portfolio. The Singapore firm had acquired a 40% stake in Future Supply in April 2016 at a valuation of Rs 1,450 crore.

Future Supply had filed its draft red herring prospectus for the IPO on 23 August. It had received an approval from the Securities and Exchange Board of India on 26 October.

Future Supply Chain will become the group’s sixth firm to list on the exchanges. Other listed firms are Future Retail, Future Consumer, Future Market Networks, Future Enterprises and Future Lifestyle Fashions.

Edelweiss, CITIC CLSA and Nomura are the global coordinators and book running lead managers for the IPO. IDFC, IIFL and Yes Securities were the other merchant bankers involved.

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SSG Capital-backed Future Supply IPO covered 7.5 times on final day

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