Shree Karni Fabcom IPO Allotment Status

Building blocks of the Shree Karni Fabcom Ltd IPO

The stock of Shree Karni Fabcom Ltd has a face value of ₹10 per share and it is a book building issue. The price band for the book building issue is set in the range of ₹220 to ₹227 per share. Being a book built issue, the price will be discovered in the above band. The Shree Karni Fabcom IPO has only a fresh issue component and no offer for sale (OFS) portion. The fresh issue portion is EPS dilutive and equity dilutive, but OFS is just a transfer of ownership. As part of the fresh issue portion of the IPO, Shree Karni Fabcom Ltd will issue a total of 18,72,000 shares (18.72 lakh shares), which at the upper band of IPO price of ₹227 per share aggregates to fresh fund raising of ₹42.49 crore. Since there is no offer for sale (OFS) portion, the fresh issue size will also double up as the overall IPO size. 

Therefore, the overall IPO size will also comprise of the issue of 18,72,000 shares (18.72 lakh shares) which at the upper band IPO price of ₹227 per share will aggregate to overall IPO size of ₹42.49 crore. Like every SME IPO, this issue also has a market making portion with a market maker inventory allocation of 93,600 shares. MLB Stock Broking Private Ltd will be the market maker to the issue. The market maker provides two-way quotes to ensure liquidity on the counter and low basis costs, post listing. The promoter stake in the company currently stands at 96.16%, which will get diluted to 70.07%, post the IPO. The company will use the fresh funds for funding capex at its dyeing unit in Navsari in Gujarat; and to buy new machinery to be installed for manufacturing bags, at its unit in Surat. Part of the funds will also be allocated towards working capital needs. Horizon Management Private Ltd will be the lead manager to the issue, and MAS Services Ltd will be the registrar to the issue. The market maker for the issue is MLB Stock Broking Private Ltd.

Checking allotment status of Shree Karni Fabcom Ltd IPO

Since this is an NSE SME IPO, there is no facility to check on the exchange website and BSE only offers allotment status for the mainboard IPOs and for BSE SME IPOs. If you have applied for the IPO, you can check your allotment status only on the website of the IPO registrar, MAS Services India Ltd. Alternatively, if your broker provides you a link to access the allotment status, you can do the same. Here are the steps that you need to follow to check allotment status on the website of the IPO registrar, MAS Services Ltd. The same can typically checked once the basis of allotment is finalized in this case, which will be late on 12th March 2024, or by middle of 13th March 2024.

Checking the allotment status on MAS Services (Registrar to IPO)

Visit the MAS Services registrar website for checking the IPO allotment status by clicking on the link below:

https://www.masserv.com/opt.asp

There are three things to remember. Firstly, you can just click on the hyper link given above and directly go to the allotment checking page. The second option, in case you are not able to click on the link, is to copy the link and paste in your web browser. Thirdly, there also a way to access this page via the home page of MAS Services Ltd by clicking on the IPO Allotment Status link displayed prominently on the home page. It all works the same.

Once you go to the main allotment status page of MAS Services the investors have 2 options. They can either query for the IPO allotment status based on the Income Tax PAN Number or on the basis of a combination of DP ID and Client ID. Here is how you can go about both these options. It must be noted here that in the past, MAS Services used to offer query on application number also. However, now the registrar does not offer query on application number, but instead it offers on PAN number. The facility to query by DP ID and Client ID is still available.

• To Query by Income Tax PAN Number, click on the “Search on PAN Number” hyperlink. This will take you to a fresh page with a box provided to input the Income Tax PAN number. Here is what needs to be done.

        ◦ Enter the Income PAN Number as it is
        ◦ PAN is a 10 character number 5 alphabets, 4 digits and finally 1 alphabet.
        ◦ PAN number is available in PAN card or in your income tax return file.
        ◦ Now, Click on Submit button
        ◦ If PAN is wrong, the same is stated in the message
        ◦ If PAN is correct, then the Allotment Status gets displayed on screen showing number of shares allotted

• To Query by DP-ID, click on the “Search on DP-id/Client id” hyperlink. This will take you to a fresh page with 2 boxes provided to input the DP ID and the Client ID in that order. Here is what needs to be done.

        ◦ Enter the DP-ID
        ◦ Enter the Client-ID
        ◦ In the case of NSDL, this combination is an alphanumeric string
        ◦ In the case of CDSL, this combination is fully a numeric string
        ◦ Once data is submitted, then you can Click on Submit button
        ◦ If DP ID / Client ID combination is wrong, the same is displayed
        ◦ If the combination is correct, then the Allotment Status gets displayed on screen showing number of shares allotted

MAS Services Ltd offers you the facility to toggle between the two search options of PAN Number and DP id, without going back to the main page. It is a good idea to take  a screenshot of the final output for your records and also for reconciliation with the demat account on the demat allotment date of March 13th 2024.

There are some basic rules to remember here. The basis of allotment is being finalized on 12th March 2024, so the investors would be able to access the online allotment status facility, either late on 12th March 2024 or by the middle of 13th March 2024. Once you get the online output, you can save a screenshot of the same, so that the same can be later reconciled with the demat credit on 13th March 2024 or later. It would appear on the demat account with ISIN Number (INE0S4Y01010)

How allocation quota and subscription impact basis of allotment

Here is a quick look at how the allocation was made across different categories of investors in the IPO of Shree Karni Fabcom Ltd at the close of the IPO on 11th March 2024.

The response to the IPO of Shree Karni Fabcom Ltd was very strong and it was subscribed 296.43X overall at the close of bidding on 11th March 2024 with the retail segment seeing 330.45 times subscription and the non-retail or HNI / NII portion seeing 461.58 times subscription. The QIB subscription ratio was also fairly robust at 112.94 times at the close of subscription on 11th March 2024. The table below captures the overall allocation of shares with the oversubscription details as of the close of the IPO on 11th March 2024. Normally, higher the subscription levels, the lower are the chances of allotment.

To sum it up, the oversubscription is quite strong in this case, so the chances of allotment in the IPO would be relatively lower. This applies to the retail portion and also to the HNI / NII portion; as the subscription is very strong in both the categories. However, it is best to wait for the basis of allotment to be finalized by late on 12th March 2024 or by middle of 13th March 2024.

Next steps in the IPO of Shree Karni Fabcom Ltd

The issue opened for subscription on 06th March 2024 and closed for subscription on 11th March 2024 (both days inclusive). The basis of allotment will be finalized on 12th March 2024 and the refunds will be initiated on 13th March 2024. In addition, the demat credits are also expected to happen on 13th March 2024 and the stock is scheduled to list on 14th March 2024 on the NSE SME segment. This is the segment, in contrast to the mainboard, where IPOs of small and medium enterprises (SMEs) are incubated. The demat credits to the demat account to the extent of allotment will happen by the close of 13th March 2024 under ISIN Number (INE0S4Y01010).

Investors would do well to remember that the level of subscription is very material as it determines the chances of getting allotment. Normally, higher the subscription ratio, lower the chances of allotment and vice versa. In this case, the subscription levels have been very high in the IPO; both in the Retail segment and also in the HNI / NII segment. Investors in the IPO need to assess their chances of allotment accordingly. The final status will be known once the basis of allotment is finalized and uploaded for you to check. You can apply the above allotment checking process flow after the basis of allotment is finalized.