Dhanus Technologies Update

The initial public offer (IPO) of Dhanus Technologies has taken a knock following reports of CBI raids on the company. At the time of going to press, more than half of the qualified institutional buyers (QIBs) had withdrawn their money from the issue. They had over-subscribed the issue by 36.1730 times initially. The issue now stands oversubscribed by 16 times overall. Initially, the company’s IPO was oversubscribed 28.7 times.

“On the retail investors’ side, there has been a withdrawal by 2.43 times at last count. In terms of HNIs, there was a withdrawal of 1.85 times,” said Ashok Parekh, head of capital markets, SREI, a book running lead manager to the issue. Dhanus Technologies’ allotment for the retail investors category of the IPO was subscribed by 18.66 times.

S Muthukrishnan, director (marketing), Dhanus Technologies, however, said they were quite confident that the investors would stay invested.

The Chennai-based company was to raise Rs 110 crore from the market by offering 42 lakh equity shares of Rs 10 each at a price band of Rs 280 to Rs 295. The issue closed on September 12 and was fairly well subscribed.

Prithvi Haldea of Prime Database said the incident was not new. There have been cases in the past when companies, before the listing of the stock on the bourses, have given option to investors to withdraw. “However allegations such as this can lead to retail investors backing out. Now it is up to the investors to take a call if they have enough confidence in the issue,” he said.