Jun 28, 2021
Dodla Dairy will make its debut on BSE and the National Stock Exchange (NSE) on Monday, according to information on the bourses. Dodla Dairy’s ₹520 crore IPO, which opened for subscription on June 16 and concluded on June 18, was subscribed 45.62 times at a price band of ₹421- ₹428 apiece.
According to IPO Watch data, Dodla Dairy traded at a premium of ₹95 a share in the grey market or at ₹523 against the issue price of ₹428. The grey market is an unofficial platform for trading in equity shares and trading here starts after the IPO price announcement.
According to Moneycontrol, experts have said they expect Dodla Dairy to list with 15–25 per cent over the issue price of ₹428 as they cited the reasonable pricing and healthy investor response to its IPO.
“The grey market is indicating chances of decent listing gains for Dodla Dairy. Dodla Dairy being the third-largest player in terms of milk procurement per day is well placed in comparison to its peers to do well in the long run. However, in general, dairy stocks have not rewarded the investors much or have not exhibited extraordinary results in the long run,” Gaurav Garg, the head of research at CapitalVia Global Research, told Moneycontrol.
Prashanth Tapse, VP research at Mehta Equities, has said Dodla Dairy will list at least ₹510 or 19 per cent premium over the upper end of the IPO price of ₹428. “Decent listing gain seems to be justified as the issue was well priced with attractive valuation when compared to other listed dairy peers and given the healthy prospects of the dairy sector going forward,” Tapse said, according to Moneycontrol.
The qualified institutional buyers (QIBs) category was subscribed 84.88 times, that for non-institutional investors 73.62 times and portion set aside for retail investors was subscribed 11.34 times. The IPO comprised fresh issuance of shares worth up to ₹50 crore, besides, an offer for sale of up to 1,09,85,444 equity shares by TPG Dodla Dairy Holdings Pte Ltd, Dodla Sunil Reddy, Dodla Deepa Reddy and Dodla Family Trust. Dodla Dairy garnered ₹520 crore from its public issue, including ₹156 crore from anchor investors.
After Dodla Dairy IPO, the promoter shareholding in the company dropped to 64.17% from the current 68.52% and public shareholding improved to 35.83% from 31.48% pre-issue. Dodla Dairy plans to use the funds raise via the fresh issue to re-pay or pre-pay debt availed by the company. The company has also said that part of the funds will also be utilised towards incremental capital expenditure requirements.
ICICI Securities and Axis Capital were the book-running lead managers for the issue.
Dodla Dairy, an integrated company based in Hyderabad, was incorporated in 1995 and it operated in south India and Maharashtra.
The Securities and Exchange Board of India (Sebi) gave its approval to Dodla Dairy to float its public offering in the last week of April. Dodla Dairy filed draft papers with the capital markets regulator earlier this year.
