IIFL - NCD Oversubscribed 1.23x, On Day 1

India Infoline Finance (IIFL) non-convertible debentures (NCD) issue is oversubscribed. According to the latest announcement made on the Bombay Stock Exchange (BSE) company made an intimation of early closure of IIFL issue of Un-Secured Redeemable Non-Convertible Debentures. According to the announcement made, the company passed a resolution on 6^th September 2012, authorizing the early closure of the Issue i.e. at 5pm on Friday, 7^th September 2012.  One could recollect that previously the issue was proposed to close on 18^th September 2012, but because of the encouraging response from the Investors the issue got oversubscribed in first day itself.

The company plans to raise NCDs worth Rs 250 crore with an option to retain over-subscription of Rs 250 crore considering the face value of Rs 1000. With this the maximum quantity available for subscription was 50,00,000. The data available on BSE shows that the issue is oversubscribed 2.47 times if we consider the amount raised to be Rs 250 crore. However the effective oversubscription comes to be around 1.23 times (considering the clause that it had an option to retain the over-subscription of Rs 250 crore, i.e. making the aggregate issue size of Rs 500 crore). The following table also shows the series wise (option wise) bifurcation of subscribed quantity:  

                        Source: BSE (as on 06/09/2012)

We at Dalal Street Investment Journal, in our NCD Issue Analysis Titled: India Infoline Finance Issues NCD, Coupon 12.75%, had said that the issue would be allotted on a ‘first come first served’ basis and given the attractive coupon rate there might be a possibility that investors would rush in and hence one should not wait for the last day to be subscribe. Further we had recommended our Investors to opt for the first option, which gives monthly interest payment which can give the best returns. Even the markets participants have majorly opted (around 79 per cent of subscribed) for the 1^st Series. And hence here we would like to take some credit.

To all those Investors who have not subscribed for the issue or in case they are bit late should not be dis-heartened as we at DSIJ believe there could be more such kind of issues and there will be opportunities for one to park some funds going ahead.