NSE IPO Turns Rs 59 Crore Bet Into Big Payday, Soach Global Eyes Nearly 25 Times Return
Soach Global is selling 20 percent of its NSE holding through the IPO, with its decade old investment potentially delivering nearly 25 times return.
Soach Global is selling 20 percent of its NSE holding through the IPO. |
Mumbai: Mauritius based Soach Global Strategic Holdings is sitting on a massive return from its decade old investment in the National Stock Exchange, with the IPO potentially delivering nearly 25 times its adjusted acquisition cost.
The investor is selling only 20 percent of its NSE holding through the offer for sale, while retaining the remaining shares as a long term investment.
Rs 59.25 Crore Investment
Soach Global, a wholly owned subsidiary of Soach Global Opportunities Fund, bought 1.5 lakh NSE shares from Industrial Finance Corporation of India in January 2016.
It paid Rs 3,950 per share, taking its original investment to Rs 59.25 crore.
Corporate actions over the following decade increased its holding to 82.5 lakh shares without any additional investment. Its adjusted acquisition cost now works out to around Rs 71.8 per share.
Rs 295 Crore Partial Exit
Soach Global is offering 16.5 lakh shares in the NSE IPO.
At the IPO price band of Rs 1,700 to Rs 1,785 per share, these shares are worth roughly Rs 280 crore to Rs 295 crore.
The upper end IPO price is nearly 25 times the fund's adjusted acquisition cost per share.
Importantly, the investor is selling just one fifth of its total NSE holding. The remaining 66 lakh shares could be valued at around Rs 1,122 crore to Rs 1,178 crore based on the IPO price band.
Why Soach Is Retaining 80 Percent?
Anubhav Dayal, Founder and Director of Soach Global Opportunities Fund, said the fund wanted retail investors to get an opportunity to own shares of NSE.
He said India's growing economy and rising participation of young investors in capital markets could create a long term opportunity for the exchange.
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Dayal compared holding NSE shares with the Indian tradition of owning gold for generations, suggesting investors could view the exchange as a long term asset.
The NSE IPO is entirely an offer for sale. NSE will not receive fresh funds from the issue, with proceeds going to selling shareholders.
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