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Day 2: CIL issue fully subscribed

business Updated: Oct 20, 2010 02:02 IST
HT Correspondent
HT Correspondent
Hindustan Times
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The public issue of Coal India Ltd (CIL) — expected to raise Rs 15,475 crore — witnessed full subscription on the second day. The country’s biggest-ever initial public offering (IPO) has two more days to go before the issue closes.

Subscribed 1.71 times to the overall issue on Day Two, the issue, priced between Rs 225 and Rs 245 per share, has already received subscription worth Rs 26,462 crore. It is expected to witness more demand in the last two days of subscription.

The IPO saw strong demand from qualified institutional buyers (QIBs) who have already oversubscribed their available portion. The issue will close for QIB subscription on Wednesday while it will remain open for other investors till Thursday.

According to a source close to the development, the QIB portion was subscribed around 2 times and the retail and high networth individual (HNI) portion was subscribed around 35 per cent.

“The issue is witnessing good demand and I see all segments of the issue getting full subscription,” said S. Subramanian, MD, Enam Investment Banking, which is one of the lead managers of the issue.

Market experts expect the issue to do well and garner more demand. “The issue is priced properly and has left value for investors. Also the fundamentals of the company are very strong,” said Divyesh Shah, CEO, Indiabulls Securities.

Coal India, which produced 431.3 million tonnes of coal in the fiscal year ended March 2010, expects to touch its coal production target this year.

“We should get close to the target of 461 million tonnes. It is stiff and we deliberately kept it stiff,” said Partha Bhattacharya, chairman, CIL on Tuesday.

Even on the first day of its opening, the issue witnessed an overall subscription of 34.0 per cent. Experts saw it as a strong response since QIBs do not generally want to block big amount of money on the first day of the issue.