Deccan Chronicle public issue subscribed 7.7 times

The initial public offer (IPO) of Deccan Chronicle Holdings, which closed today, received a huge response from the market. The IPO of 8.01 million shares was subscribed more than 7.7 times, receiving bids for 6.23 crore shares. SBI Mutual Fund (MF), State Bank of India, Pru ICICI MF, Reliance MF, Sundaram MF and PNB were among the biggest bidders.

The IPO, comprising of 8,013,100 equity shares, was priced at Rs 162 to Rs 194 a share. At this price, the IPO is expected to yield between Rs 130 crore and Rs 155 crore for the company, officials said.

The final share allocation and pricing will be determined through the book building. The retail portion was oversubscribed 13.68 times and the QIB portion was subscribed 4.73 times.

J Niranjan, joint head of investment banking at ICICI Securities and the book running lead manager, said, "Widespread interest was seen among all segments of investors. Despite foreign investors not participating in this issue the domestic response was tremendous, highlighting the local depth and appetite for good quality issues."

In order to operate a post issue price stabilisation, the issue has a greenshoe option of 1,201,960 equity shares and ICICI Securities has been appointed as the stabilisation agent.

The issue constitutes approximately 20 per cent of the fully diluted post offer paid-up capital assuming that the greenshoe option is not exercised, and approximately 22 per cent, assuming that the greenshoe option is exercised in full.

Deccan Chronicle is a English daily and ranks among the market leaders in Andhra Pradesh. The capital raised will be used for financing new printing facilities, and venturing into new territories and future strategic initiatives and acquisitions, company officials said.

The company has also announced that it will be launching Deccan Chronicle in Tamil Nadu shortly.