Initial public offer of real estate firm Emaar MGF on Friday got subscribed 12 per cent against the shares on offer in the first two hours of opening of the issue. The issue received bids for over 1.27 crore (12.7 million) shares as against 10.25 crore (102.5 million) shares on offer, latest data available on the National Stock Exchange for 1200 hours show.
The company had on Thursday slashed the price band to Rs 540-630 from the earlier Rs 610-690 with an aim to attract more retail investors.
At the upper end of the band, the company would be able to raise about Rs 6,457 crore (Rs 64.57 billion) while at the lower end, it would mop up around Rs 5,535 crore (Rs 55.35 billion).
Emaar MGF, which is a joint venture between Dubai-based Emaar Properties and India's MGF Development, has launched its public issue of 10.25 crore (102.5 million) equity shares of Rs 10 each to be determined through the 100 per cent book building. The issue, which opened on Friday, would close on February 6.
Emaar MGF proposes to utilise Rs 2,560 crore (Rs 25.6 billion) of the proceeds towards part-payment of land acquisition. Besides, Rs 775 crore (Rs 7.75 billion) would go into development cost of a project in Gurgaon and Rs 1,450 crore (Rs 14.5 billion) in repayments of loan.
The company is diluting 10.4 per cent stake of the fully diluted post-issue equity share capital. In the Emaar MGF JV, Emaar has 41.9 per cent stake while MGF Development has 53.3 per cent share. Post-issue, MGF's stake would come down to about 48 per cent, while Emaar's share would be at 39 per cent.
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