• Mahanagar Gas IPO sails through, subscribed 1.08 times on Day 1

    The Rs 10.40 billion initial public offering (IPO) of Mahanagar Gas received good response on Tuesday, with the issue sailing through on Day 1 itself. Data showed that the issue received bids for 1,88,19,255 shares, 1.08 times the total size of 1,73,46,150 shares. On NSE, QIB quota was subscribed 1.59 times, non-institutional investor quota 0.15 times and retail individual investor quota 0.37 times. On BSE, the QIB quota was subscribed 0.22 times, non-institutional subscribed 0.22 times, non-institutional investor 0.07 times and the retail quota 0.71 times.

    The company has fixed 50 per cent quota for qualified institutional buyers (QIBs). Non-institutional bidders will be issued not more than 15 per cent of the issue size. The remaining 35 per cent quota has been kept aside for retail investors. “On considering almost similar growth potential as that of industry peer Indraprastha Gas(IGL), Mahanagar Gas’ RoE levels in excess of 22 per cent in last six years, debt-free status, yearly cash flow generating potential of Rs 2 billion and strong dividend payout ratio make the issue price attractive at 12.9 times FY2016 PE,” Angel Broking said in a note.

    The gas distributor had on Monday allotted 7,348,350 equity shares to 25 anchor investors at Rs 421 a share, thus raising Rs 3.093 billion. BNP Paribas, Morgan Stanley, DB International Asia, Abu Dhabi Investment Authority-Merrill Lynch Capital Market and DSP BlackRock were among the anchor investors that subscribed to the issue. The issue is an offer for sale (OFS) in which existing promoters GAIL and Singapore-based BG Asia Pacific Holdings — now acquired by Royal Dutch Shell — intend to sell 12,347,250 shares each, aggregating to 24,694,500 shares of face value Rs 10 each.

    The company has supplied CNG to over 0.47 million vehicles through a network of 188 CNG filling stations as of March 31. It has PNG connections to approximately 0.86 million domestic households, over 2,866 commercial and 60 industrial consumers in Mumbai and its adjoining Areas. The company’s total revenue has grown at a compound announce growth rate (CAGR) of 12.42 per cent to Rs 21.2162 billion in FY16 from Rs 13.2834 billion in FY12. Profit after tax (PAT) has risen 0.08 per cent on an annualised basis to Rs 3.0868 billion in FY16 from Rs 3.0774 billion in FY12.  Jason Castro Authentic Jersey

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