96% of buyers in Cello World IPO observed HNIs bidding 2.63 times through Day 2

 96% of buyers in Cello World IPO observed HNIs bidding 2.63 times through Day 2

Cello World IPO | With only the Rathod family's offer for sale, the company hopes to raise Rs 1,900 crore via its initial public offering.

The market reacted well to the Cello World initial public offering (IPO), as investors purchased 2.11 crore equity shares against a 2.2 crore offer size. This resulted in a 96 percent subscription up to the second day of bidding on October 31.

Rich people are leading the charge to increase IPO subscriptions, bidding 2.63 times the limit, while regular investors have purchased 82% of the shares reserved for them. Employees bid on 89 percent of their quota, with the remaining 3 percent allocated for eligible institutional purchasers.

Employees of the Mumbai-based consumer goods firm will get shares valued at Rs 10 crore, discounted by Rs 61 per share from the final issue price. The net problem is the offer less the staff quota.

A portion of the net issue—35 percent—is held back for regular investors, with the other half going to high net worth individuals and eligible institutional purchasers.

The offering has a price range of Rs 617–648 per share. Through its initial public offering, which comprises only of the Rathod family's offer for sale, Cello World hopes to raise Rs 1,900 crore.

Therefore, this offer will not result in any financial gain for the organization. The promoters will get all net issue proceeds, less issue costs.

Also read: Brokers approve of Cello World IPO: Should you invest in the Rs. 1,900-cr issue?

A number of major investors, including Goldman Sachs, Morgan Stanley, Nomura, Florida Retirement System, HSBC, HDFC Mutual Fund, Aditya Birla Sun Life Trustee, Tata Mutual Fund, ICICI Prudential Mutual Fund, ICICI Prudential Life Insurance, and HDFC Life Insurance Company, contributed Rs 567 crore to the company last week as part of the public offering.

Having been incorporated in 2018, Cello World is a well-known participant in the Indian consumer goods industry, with a presence in the areas of consumer glassware, writing instruments and stationery, and molded furniture and related items.

According to experts who requested anonymity, the IPO shares of the company are still trading at a significant premium above the top price band on the grey market, with a 20 percent premium. An unauthorized market for trading IPO shares prior to listing is known as the "grey market."