Avenue Supermarts Ltd (ASL), which runs hypermarkets under the D-Mart brand, will launch its initial public offering (IPO) on 8 March. The three-day offering will close on 11 March, the company said in a stock exchange filing.
VCCircle had first reported in September 2016 that D-Mart had picked Kotak Mahindra Capital Co Ltd as the lead banker for the IPO.
The maiden public offering will comprise a fresh issue of shares worth Rs 1,870 crore ($280 million). The company will use almost 20% of the net proceeds to repay debt and a part of it to open new stores.
The IPO is expected to be priced at Rs 300-320 apiece, two grey market dealers told VCCircle requesting anonymity. The company will sell 62.33 million shares, which will see a stake dilution of 11% stake at the lower end of the estimated price band, they added.
In the grey market, ASL shares were quoting a premium of Rs 140-150 per share over its estimated price band. The grey market is a pseudo for over-the-counter market, where IPO shares are traded before the official listing on a stock exchange.
The anchor book will open on 7 March, one business day prior to the opening of the public issue. Anchor investors are institutional investors who accept a one-month lock-in period for a sizeable allocation of shares and support a public offering. Their participation highlights investors’ confidence in an IPO and sets a benchmark for the investor community at large.
D-Mart is the first multi-line retail company to float an IPO in almost a decade. The last one to go public was V2 Retail (Vishal Retail) in 2007. A successful listing of D-Mart could open the window for other peers to test the public market.
For more details on the IPO, click here.
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