Aditya Birla Sun Life AMC IPO allotment starts tomorrow, IPO was subscribed 5.25 times

• The company is likely to announce its share allotment status on October 6.
• The mutual fund company’s IPO was subscribed 5.25 times on the last day of bidding.
• Investors have bid for 14.59 crore shares against the 2.77 crore shares on offer.

The mutual fund company Aditya Birla Sun Life AMC is likely to announce the allotment of its initial public offering (IPO) status on Wednesday, October 6.

The IPO was open for subscription between September 29 and October 1.

The mutual fund company is looking to raise ₹2,768 crore through sale of 3.88 crore shares. The IPO proceeds will go to promoters since the company is a joint venture between Aditya Birla Capital and Canadian firm Sun Life AMC. Both the promoters will jointly sell a 13.5% stake in the company through the IPO.

Overall, investors have bid for 14.59 crore shares against the 2.77 crore shares on offer.

The portion for qualified institutional investors was subscribed 10.36 times while the non-institutional investor category received a bid for 4.39 times.

The IPO has received decent response from investors overall, however, qualified institutional buyers and non-institutional investors subscribed to it the most.

A tepid response from investors and weak grey market premium indicates a weak listing for the company’s stock. The grey market premium slipped to ₹4 from ₹70 in the last week.

However, analysts expect the mutual industry’s AUM to grow by 11-13% in the next five years at ₹57 trillion and Aditya Birla Sun Life AMC to benefit from strong industry prospects given it is among the top five players.

The ₹36 trillion mutual fund industry in India, with 44 players may see consolidation happening in the next couple of years considering the majority of the market is held by the country’s top 10 fund houses, said the company in an interview to Business Insider.

As of June quarter 2021, the top 10 mutual fund companies held 82% of the market share, as per Association of Mutual Funds in India (AMFI) data.

The fourth largest mutual fund (MF) company Aditya Birla Sun Life AMC, which opened its IPO on September 29, alone holds over 8% market share.

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