There is a big buzz about the Zomato IPO. The online food delivery service has caught the investors’ eye and the Rs 9,375 crore offer has seen over-subscription 38.24 times.
Zomato's initial public offering (IPO) last week ended with a bumper 38 times subscription. The IPO of Zomato was India's biggest initial share sale offer since March 2020.
The stock made its debut at Rs 115, reflecting a huge gain of 51.31 per cent against the issue price on the BSE.
It almost hit the upper circuit (Rs 139.20)within the first 10 minutes of its listing but then witnessed profit booking. At around 10.20, the stock was trading in the range of Rs 130-132.
This comes close on the heels of the closure of competitor Zomato's mega initial public offering (IPO) which gives Zomato a valuation of Rs 64,365 crore.
Founded by Anshoo Sharma and Brij Bhushan in 2016, Magicpin connects hyperlocal merchants and brands with consumers.
Zomato’s IPO was subscribed almost five times on the second day and 1.05 times at the end of the first day of the issue.
Zomato had already raised Rs 4,196.51 crore from 186 anchor investors on July 13, a day before the issue opening
The much-anticipated IPO (initial Naveen Kulkarni, Chief Investment Officer, Axis Securities, said, 'We expect the company to breakeven at operating levels in FY22, making the IPO more lucrative.'
The conventional application process for IPOs was designed around timings, and till date, users are able to apply for an IPO only during select market hours over a window of three days.
Sooner than later, they may get into benchmark indices like the Sensex or the Nifty. That is what drives a lot of long-term investors like mutual funds and pension funds to invest.
A day after Zomato formally announced the launch date and details of its upcoming IPO, its shares are trading at a premium of over 20% in the grey market.
With a mere 8-9% restaurant penetration in India, compared to 53% in China and 35% in the US, food delivery player Zomato is aiming to change the food consumption demography in India.
The food ordering platform had received markets regulator Sebi's go-ahead for the initial public offer.
Zomato has proposed to open its bid offer for institutional/ retail investors on stock exchanges from July 14-16, earlier than the proposed dates, signalling a peaked interest from the market.