NTPC issue sold 4 times on Day 1

IPO received bids for 3.179 billion shares.

National Thermal Power Corporation's (NTPC's) initial public offering (IPO) opened to a thumping response today, and was subscribed almost four times.

Against an issue size of 865.8 million shares, the IPO received bids for 3.179 billion shares, according to figures posted on the Bombay Stock Exchange (BSE) website.

The State Bank of India bid for shares worth more than Rs 2,000 crore on the first day of the IPO.

Merchant bankers said 95 per cent of the bids received today were made by qualified institutional investors and most of them were at the upper end of the price band.

Therefore, 50 per cent of the offer size reserved for qualified institutional investors has been subscribed almost seven times.

Confirming SBI's mega bid, bank sources said it had a long relationship with NTPC as its principal banker. "We believe that the NTPC share is value for money," an SBI executive said.

The NTPC issue for 865.8 million equity shares of a face value of Rs 10 each opened today and will close on October 14. The IPO has been priced in a band of Rs 52-62 per share.

S Ramesh, executive director at Kotak Investment Banking, one of the book-running lead managers of the same, said, "The response to the offer reflects the confidence of investors in India, NTPC and the country's infrastructure sector."

He added that the huge subscription also reflected the depth of the capital market and the appetite for quality issues.

Manish Chokhani, director, Enam Secutities, another book-running lead manager, said: "The success of the NTPC issue has validated the depth of the market. The issue was managed by domestic banks and we still saw an overwhelming response from global investors."

S Mukherjee, managing director of ICICI Securities, yet another book-running lead manager to the IPO, told Business Standard from London: "The issue received an excellent response from the East as well as the West owing to the strong fundamentals of the country's largest power company."

Mukherjee is part of the team that organised road shows for the offer in New York and London. The lead manager had planned a dozen road shows overseas to attract foreign investment for the issue.

Power packed IPO

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Second biggest
The NTPC issue will raise Rs 5,386 cr if it is priced at the top of the Rs 52-62 band, placing it just below the TCS issue

Bank to the future
SBI bid for shares worth Rs 2,000 crore