MUMBAI (Reuters) - State-run New India Assurance Co Ltd's initial public offering of shares to raise 96 billion rupees ($1.49 billion) was covered 1.2 times by subscriptions on the last day of the sale, showing relatively weak demand in what has been a record year for IPOs in the country.
Stock exchange data showed institutional investors bid for 2.34 times the number of shares reserved for them in the IPO of the nation's top general insurance company. However, just 0.11 percent of the portion reserved for retail investors was subscribed for.
Ahead of the New India sale, companies in India had raised $8 billion from IPOs in 2017. Stronger stock markets that have drawn more investors to invest in equities have buoyed the demand for IPOs with several issues seeing big oversubscription.
New India's IPO got a mixed response from analysts, with some like Mumbai brokerage Centrum advising clients to "avoid" the sale, citing falling profits and expensive valuations among other factors.
The Indian government, which fully owned the insurer before the IPO, was selling 96 million shares, while the company was selling 24 million new shares in the issue which constituted a total 14.56 percent stake.
The nation's top insurer, state-run Life Insurance Corp of India, which is typically a big investor in share sales related to state-owned companies, bid for 58.2 million shares in the IPO, IFR, a Thomson Reuters publication, reported.
LIC had bought a 7 percent stake in the $1.7 billion IPO of state-run reinsurer General Insurance Corp which listed last week.
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HDFC Standard Life Insurance Co. Ltd, a private sector insurer, is set to take subscriptions for its 86.95 billion-rupee IPO net week.
($1 = 64.5600 Indian rupees)
(Reporting by Devidutta Tripathy; Editing by Greg Mahlich)