OnMobile IPO Oversubscribed 10.95 Times
In these volatile times of choppy global and local markets, the OnMobile IPO has been oversubscribed 10.95 times, perhaps helped by a timely research report on the listings prospects. The issue, a dilution of 18.99 percent of the companys post-issue paid up capital, has been priced between Rs. 425-450. Around 40.5 lakh of the 10.9 crore bids have been received at the cut-off price. However, as expected, retail sentiment was low and that segment was oversubscribed only 1.3 times. Remember, Infosys, which had incubated OnMobile and holds a minority stake in the company, had opposed the listing reportedly because of poor market conditions. However, the Qualified Institutional Buyer segment was subscribed 17.16 times. At cut-off, the company will raise around Rs. 450 crores from the IPO. Interestingly, the company is expected to deploy 25 percent of its equity to acquisitions and global expansion. Lots of easy pickings? OnMobile is India’s largest mobile value-added-services company, with a 2007 revenues at Rs. 1329.7 million, profit after tax of Rs. 337.2 Million.
It will be interesting to see how OnMobile fares in the secondary markets. Could be a good indicator on how the market perceives Mobile-VAS industry
Well, I wouldn't bank on the markets to be an indication of the perception of the VAS industry…too many factors influencing trading right now, and lot of prices are based around hype. If you read the details of the research report I've linked to, they've suggested that people invest for listing gains.
We cant bank on the markets now but maybe once some sanity. Listing gain gain too could become listing losses if he market takes a downturn. Lets wait for Cellebrum and rest of the VAS pack to go public. Good or bad but the coming few months should exciting. I am sure this is just the begining.
Do you think Celelbrum could be an IPO worth looking forward to ?Considering it has Modi-Effect + Spice legacy.
Arvind pulled OM IPO on last day. Story of a true financial market wiz.