On the second day of it’s bidding, RailTel Corporation of India’s IPO subscribed 3.08 times so far with strong support from retail investors.
The reserved portion of retail investors was recorded at 5.8 times subscription.
RailTel’s IPO has witnessed major profitability since FY07 along with consistent payment of divided since FY08.
Moreover, the subscription data available on the exchanges highlighted on bids received for 18.76 crore equity shares against offer size of over 6.11 crore share.
Further, the company had successfully acquired Rs 244 crore from anchor investors on Monday as the above offer size is exclusive of anchor book.
Precisely, 87 percent was subscribed for the portion particularly reserved for non-institution investors whereas 87 percent was on that of employees.
The Rs 819-crore IPO is set to be a complete offer for the purpose of selling over 8.71 crore equity shares by the Government of India.
The opening day of the issue for subscription was on February 16 recording the price band reportedly at Rs 93-94 per share.
On FY20 basis, RailTel is obtainable at a P/E of 21.4x which is at the upper price brand and hence appears to be fully priced.
RailTel is projected to play a key role in digital transformation of Indian Railways.
In fact, the company’s margins & return ratios are better compared to other telecom players in India.
Accordingly, the company also has a strong financial position which is debt free along with strong fundamentals making it more desirable.
RailTel Corporation of India’s quarterly numbers are evidently promising. Hence one can expect good returns on the RailTel IPO price listing date itself.
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