The initial public offering (IPO) of Dodla Dairy has been subscribed 5.19 times so far on June 18, the last day of the bidding process. The offer has received bids for 4.41 crore equity shares against the total issue size of 85.07 lakh equity shares, according to subscription data available on exchanges at 12:05 pm.
The portion set aside for retail investors has been subscribed 7.82 times, while that of non-institutional investors saw 2.09 times subscription. The qualified institutional buyers’ portion received a 2.91 times subscription so far.
The Rs 520-crore IPO of Dodla Dairy, which opened at a price band of Rs 421-428 per equity share, closes on June 18.
The company has already raised Rs 156.05 crore by allocating a total of 36,46,099 equity shares at Rs 428 apiece to anchor investors on June 15 ahead of its IPO.
Brokerages have recommended subscribing to the Dodla Dairy IPO on the back of the company’s strong financial performance, robust business growth, growth potential, reasonable valuations, and long-term prospects of the domestic dairy industry.
"Despite the lack of earnings growth over the forecast period (given the high base effect of net earnings for FY21), we expect a re-rating of the valuations given the market leadership, strong sectoral growth trends, improved efficiencies (by eliminating market intermediaries), thrust on expanding retail footprint, debt-free status, completion of capex cycle, and high return ratios," said Ventura Securities.
It values the stock at Rs 580 (25x FY24E) representing a potential upside of 35.4 percent from the IPO higher band price of Rs 428 over the next 24 months.