Air Deccan IPO scrapes through

Oversubscription of 1.23 times is nothing to write home about

BY A CORRESPONDENT
May 28, 2006

Even after extending its IPO for three days and reducing the price band, the Air Deccan IPO managed to get a paltry oversubscription of 1.23 times. 2.45 crore shares were on offer.

According to NSE data, the QIB portion was subscribed 1.0899 times. The Non Institutional Investors segment has been subscribed 1.1535 times and the retail portion has been subscribed 1.4565 times.

Air Deccan MD GR Gopinath was quoted as saying: "As people were in a shock, they did not have enough time to evaluate the investment opportunity. So we thought we should give this opportunity to more number of people to offer their bids."

Air Deccan IPO is the only one in the Indian stock market history have its subscription period extended and its price ban altered. The Air Deccan issue was buffeted from Day One, since the markets have been in a free fall from May 18, the day the IPO opened for subscription.

Shocked by the misfortune, the Air Deccan MD had even gone on quote, saying that "It was as if a tsunami had hit the issue. We asked our people to work hard and leave the rest to God. Our fundamentals helped."

Last year, Jet Airways which had gone to capital market through a similarly book-built issue had seen an oversubscription of 10 times. However, the stock has since been trading much lower, even before the crash of last week hammered it further.