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L&T Technology, GNA Axles IPOs oversubscribed

16 September, 2016

The initial public offering (IPO) of L&T Technology Services Ltd and GNA Axles Ltd were both oversubscribed, adding to the list of firms that successfully navigated their public issues.

L&T Technology that had a slow start to its IPO with just under a fifth of the issue covered at the end of day 1, but saw institutional investors get more active on the second day, elicited bids worth 2.5 times or was oversubscribed 1.5 times.

The research unit of Larsen & Toubro Ltd (L&T), India’s biggest engineering firm, saw institutional investors bid for five times the number of shares reserved for them. Retail investors’ portion was oversubscribed 72% while corporates and high net-worth individuals bid for just about the total shares reserved for them.

The firm that is seeking a valuation of as much as Rs 8,745 crore ($1.3 billion), will be the fourth group firm to list on stock exchanges. Parent L&T has been a public firm for decades while the group’s financial services arm, L&T Finance Holdings Ltd, floated its IPO five years ago. In July, another Larsen unit, L&T Infotech Ltd floated its IPO.

L&T Technology offers R&D solutions for industries such as industrial products, transportation, aerospace and telecom. It also offers services in areas such as mechanical engineering, embedded systems, besides proprietary solutions in engineering data analytics, and the Internet of Things (IoT). 

The company was set up in January 2014 by carving out the product engineering services segment from L&T Infotech. The integrated engineering business from L&T was then transferred to the new entity in April 2014.

The issue is being managed by JM Financial, Kotak Investment Bank, Bank of America Merrill Lynch and SBI Capital Markets.

GNA Axles

The IPO of rear axle shafts maker GNA Axles Ltd that raised Rs 37.8 crore from a string of mutual funds run by Reliance Capital, HDFC and UTI, was oversubscribed with one day to spare. The firm saw bids for twice as many shares as of on offer on day 2.

Corporates and HNIs have bid for twice the number of shares reserved for them while retail investor’s portion, too, was oversubscribed 86%. Institutional investors, who stayed away on the first day, bid for 79% of the shares reserved for them.

The issue is being managed by PNB Investment Services Ltd and Ambit Pvt. Ltd.

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L&T Technology, GNA Axles IPOs oversubscribed

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