Diensten Tech IPO Subscription Status

Tanushree Jaiswal

Last Updated: 27th June 2024 - 05:51 pm

Diensten Tech IPO - Day-2 Subscription at 3.73 times

As of 5.03 pm on 27th June 2024, out of the 14.70 lakh shares on offer in the IPO (excluding the market maker portion and the anchor allocation done), Diensten Tech saw bids for 54.792 lakh shares. This implies an overall subscription of 3.73X at a macro level at the close of Day-2 of the IPO. The granular break-up of subscriptions as of the close of Day-2 of the Diensten Tech IPO was as under:

QIBs (0.00X)

HNI / NII (6.43X)

Retail (4.70X)

The subscriptions were led by the HNI / NII investors followed by the Retail investors and then by the QIB investors in that order. The QIB quota and the NII / HNI will typically gather most of the momentum on the last day, and that would be the case in this issue also in the case of the HNI / NII bids and the QIB bids. The NII bids pick up momentum on the last day since that is when the bulk HNI funding bids, corporate bids and the large HNI bids come in. Even the institutional bids come in on the last day in the first half. Here are the details of the category-wise subscription. The overall subscription ratio calculation excludes anchor portion and also the market making portion in the IPO.

Investor Category	Subscription (times)	Shares Offered	Shares Bid For	Total Amount (₹ in Crore)
Market Maker	1.00	1,10,400	1,10,400	1.10
Anchor Quota	1.00	6,27,600	6,27,600	6.28
QIB Investors	0.00	4,20,000	0	0.00
HNIs / NIIs	6.43	3,15,600	20,30,400	20.30
Retail Investors	4.70	7,34,400	34,48,800	34.49
Total	3.73	14,70,000	54,79,200	54.79

Data Source: NSE

The IPO is open up to June 28th, 2024, at which point we will know the final subscription status of the IPO. As of today, the status is only updated as of the end of Day-2 of the IPO. The QIB and the HNI / NII categories see the best momentum coming only on the last and final day of the IPO, while the retail investors predominate on the first two days of the IPO. The market maker portion and anchor quota are excluded for the purpose of calculating the number of times subscription to get a realistic picture of the IPO subscription story.

Diensten Tech IPO Subscription Status on Day-1 at 1.01 times

As of 5.09 pm on 26th June 2024, out of the 14.70 lakh shares on offer in the IPO (excluding the market maker portion and the anchor allocation), Diensten Tech saw bids for 14.84 lakh shares. This implies an overall subscription of 1.01 times at a macro level at the close of Day-1 of the IPO. The granular break-up of subscriptions as of the close of Day-1 of the Diensten Tech IPO was as follows:

QIBs (0.00X)

HNI / NII (1.51X)

Retail (1.37X)

Investor Category	Subscription (times)	Shares Offered	Shares Bid For	Total Amount (₹ in Crore)
Market Maker	1.00	1,10,400	1,10,400	1.10
Anchor Investors	1.00	6,27,600	6,27,600	6.28
QIB Investors	0.00	4,20,000	0	0.00
HNIs / NIIs	1.51	3,15,600	4,77,600	4.78
Retail Investors	1.37	7,34,400	10,06,800	10.07
Total	1.01	14,70,000	14,84,400	14.84

Data Source: NSE

The IPO is open up to June 28th, 2024, at which point we will know the final subscription status of the IPO. As of today, the status is only updated as of the end of Day-1 of the IPO. The QIB and the HNI / NII categories see the best momentum coming only on the last and final day of the IPO, while the retail investors predominate on the first two days of the IPO. The market maker portion and anchor quota are excluded for the purpose of calculating the number of times subscription to get a realistic picture of the IPO subscription story.

Diensten Tech - Share Allocation Across Categories

The table below captures the break-up of the overall share allocation to QIBs, retail investors and to the HNI / NII investors. The anchor allotment is carved out of the QIB quota and the QIB quota is reduced accordingly. The market maker allocation is the inventory that will be used by the market maker to provide liquidity in the counter post listing, to keep the bid-ask spreads low and reduce the risks of trading in the stock. The company has appointed Share India Securities Ltd as the market maker and assigned a market making inventory of 1,10,400 shares to them. The market maker will use this inventory to offer buy and sell quotes to keep the counter liquid and reduce the basis risk on the stock post listing.

Category of Investors	Allocation of Shares under IPO
Market Maker	1,10,400 shares (5.00% of total issue size)
Anchor Allocation	6,27,600 shares (28.42% of total issue size)
QIB Shares Offered	4,20,000 shares (19.02% of total issue size)
NII (HNI) Shares Offered	3,15,600 shares (14.29% of total issue size)
Retail Shares Offered	7,34,400 shares (33.26% of total issue size)
Total Shares Offered	22,08,000 shares (100.00% of total issue size)

Data Source: Company RHP

The issue size, net of the market maker quota, has been divided between the QIB investors, retail investors and the HNI / NII investors. On June 25, 2024, the company made an anchor allocation of 6,27,600 shares to anchor investors at a price of ₹100 per share. This included the par value of ₹10 per share and premium of ₹90 per share. The total size of the anchor allocation was ₹2.98 crore.

The anchor allocation was done across 2 anchor investors at the upper end of the price band at ₹100 per share. These 2 major anchor investors included Saint Capital Fund (63.86%), and Investi Global Opportunity Fund PCC – Cell I (36.14%). There were no other anchor investors allotted shares in the pre-IPO anchor bidding on June 25, 2024.

Out of the total anchor allocation of ₹6.28 crore, a total of 50% of the allocation will have a 1-month lock in up to July 31, 2024 and the balance 50% will have a 3-month lock-in up to September 29, 2024. The anchor portion was carved out of the QIB portion, as a result of which the QIB quota available in the IPO was reduced from 47.49% to 19.02%. The stock will list on the stock exchanges on the third working day after the closure of the IPO.

About Diensten Tech IPO

The stock of Diensten Tech has a face value of ₹10 per share and it is a book built issue. The price for the book building issue is set in the price band of ₹95 to ₹100 per share. Being a book built issue, the final price will be discovered within this band. The IPO of Diensten Tech has entirely a fresh issue component and no offer for sale (OFS) portion. While the fresh issue portion is EPS dilutive and equity dilutive, the OFS is just a transfer of ownership and hence is not EPS or equity dilutive. As part of the fresh issue portion of the IPO, Diensten Tech will issue a total of 22,08,000 shares (22.08 lakh shares), which at the upper band IPO price of ₹100 per share aggregates to fresh fund raising of ₹22.08 crore. Since there is no offer for sale, the fresh issue will also double up as the total issue size. Hence the overall IPO size will also comprise of the fresh issue of 22,08,000 shares (22.08 lakh shares) which at the upper band IPO price of ₹100 per share will aggregate to overall IPO size of ₹22.08 crore.

Like every SME IPO, this issue also has a market making portion. The company has set aside a total of 1,10,400 shares as quota for market making inventory. Share India Securities Ltd will be the market maker for the issue. The market maker provides two-way quotes to ensure liquidity on the counter and low basis costs. The company has been promoted by JK Trades Ltd, Abhishek Singhania, Vipul Prakash, and Tina Prakash. The promoter holding in the company currently stands at 95.50%. However, post the fresh issue of shares, promoter equity holding share will get diluted to 69.97%. The fresh issue funds will be used by the company to pay the outstanding consideration for the professional services & training division from JK Technosoft Ltd and to meet the working capital needs of the company.

A small part of the IPO proceeds has also be set aside for general corporate purposes. Corporate Professionals Capital Private Ltd will be the lead manager to the issue, and KFIN Technologies Ltd will be the registrar to the issue. The market maker for the issue is Share India Securities Ltd. The IPO of Diensten Tech will be listed on the SME IPO segment of the NSE.

Next Steps in the Diensten Tech IPO

The Diensten Tech IPO is open for subscription from 26th June 2024 and closes on 28th June 2024. The basis of allotment will be finalized on 1st July 2024, refunds will be initiated on 2nd July 2024, and demat credits are expected by the end of 2nd July 2024. The stock is scheduled to list on 3rd July 2024 on the NSE and the BSE.

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