Nykaa IPO: Robust Response Retail Investors, Offer Subscribed 155% On Day 1

The initial public offering (IPO) of FSN E-Commerce, which runs online lifestyle marketplace Nykaa witnessed robust interest from retail investors on the first day of the offer.

At the end of the first day of the offer, the IPO was subscribed 1.55 times (155%). Investors bid for 4,09,73,280 shares during the day against the 2,64,85,479 shares on offer.

The oversubscription was backed by an overwhelming interest among retail investors.

According to BSE data, The portion reserved for retail individual investors (RII) was subscribed 3.50 times. They bid for 1,66,33,956 shares against allocated 47,53,187 shares.

The retail investors had fully subscribed to the allocated portion of shares in the first hour of the offer itself.

Qualified institutional buyers (QIB) also oversubscribed their portion of the shares on Thursday.

• Qualified institutional buyers’ bids were 1.39 times the portion of shares allocated to them. QIBs (the foreign investors of Nykaa’s IPO) have bid for 1,99,05,552 shares out of the earmarked 1,43,52,511 shares.
• The portion for non-institutional investors, including corporates and individuals (other than retail investors) bid for 42,64,632 (60%) out of the allocated 71,29,781 shares.
• Further, the portion reserved for employees has been subscribed 0.68 times (68%). Employees had bid for 1,69,140 shares of the allocated 2,50,000 shares.

On Wednesday, FSN E-Commerce raised over INR 2,395.84 Cr by allocating nearly 2.13 Cr shares to 174 anchor investors. 

The investors subscribed to the shares at a value of INR 1,125 per share, an upper limit of the IPO price band (INR 1,085 – INR 1,125).

In a regulatory filing, FSN E-Commerce said, “Under Anchor Investors (AIs) portion in the public issue of FSN E–Commerce Ventures Limited, 21,296,397 equity shares have been subscribed today at Rs 1,125 per equity share.”

The anchor investors included — Blackrock, Fidelity International, the Government of Singapore and the Monetary Authority of Singapore.

Out of the total allocation to the Anchor Investors, 7,098,801 equity shares, 33.33% of the total allocation to anchor investors were allocated to 21 domestic mutual funds through a total of 93 schemes.

The IPO which opened earlier today (28th Oct), will close on November 1. As per the startup’s red herring prospectus (RHP), its IPO includes a fresh issue of INR 630 Cr and an offer for sale (OFS) of up to 41,972,660 shares.

The beauty and lifestyle unicorn’s offer initially included a fresh issue of shares up to worth INR 525 Cr and an offer-for-sale of equity shares up to 43,111,670 equity shares. However, the company later raised its fresh issue size to INR 630 Cr.

At the estimated price band, the company will raise funds in the range of INR 4,554.03 Cr – INR 5,351.92 Cr.

Under the OFS, Sanjay Nayar Family Trust, the company’s promoter is offering up to 4.8 Mn shares. Nykaa’s investors — TPG Growth IV SF Pte Ltd and Lighthouse India Fund III would sell up to 5,421,510, and 4,844,620 shares, respectively.

Falguni Nayar, the founder of the ecommerce unicorn, along with her husband Sanjay Nayar, their children Anchit Nayar and Adwaita Nayar hold 53.5% share in the company, as per the DRHP.