MCX commodity exchange comes with an IPO on 22nd Feb

February 15, 2012   ·   0 Comments

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India’s largest commodity exchange MCX will hit the capital market next week with an estimated Rs 650-750 crore initial public offer on February http://stockssavvy.com22, becoming the first ever IPO by an exchange in the country.  The bidding for shares in the IPO process would begin on February 22 and close on February 24, the company said in its Red Herring Prospectus, the final document for the offer.

MCX had recorded Rs 447.5 crore of total income and Rs 176.2 crore of net profit in the fiscal year ended March 31, 2011. In the current fiscal, the company has posted net profit of Rs 218 crore and total income of Rs 474 crore for the nine-month period ended December 31, 2011. The IPO ,000 crore.

Price Band for MCX IPO:

While the price band for the IPO is yet to be fixed, sources said that the IPO could raise Rs 650-750 crore.  This could also be the first IPO of the year 2012. The offer would comprise of sale of about 64.27 lakh shares, accounting for a 12.6 per cent stake in the company. This would include 2.5 lakh shares reserved for employees.

 

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Besides the promoter Financial Technologies (India) Ltd, shares would also be sold by other shareholders like State Bank of India, Corporation Bank, Bank of Baroda, ICICI Lombard General Insurance, GLG Financials Fund and Alexandra Mauritius Ltd in the IPO.  The promoters FTIL currently holds 31.2 per cent stake in MCX, which would come down to about 26 per cent after the IPO.

MCX said in its RHP that the IPO have been assigned top-most grading of ‘5/5’ by Crisil, indicating strong fundamentals.

MCX, the largest commodity bourse in the country, has more than 70 per cent share in an annual estimated turnover Rs 177 lakh crore for the entire commodity derivatives market.  Globally, MCX is the fifth largest commodity exchange, while it figures among the top two positions in gold and silver segments.

It would be the first exchange in India to go public, putting the country at par with other markets like the US, UK, Japan, Australia, Singapore and Hong Kong.

 

Grey Market premium of MCX is around 180 – 185 Rs. last time when we checked. This shows the appetite towards the IPO is quite healthy & IPO could give some good listing gains. Stay tuned for detailed analysis of the IPO.

Share offerings in the pipeline include a follow-on share sale by state-run companies Oil and Natural Gas Corp, Steel Authority of India and Bharat Heavy Electricals Ltd.  Stock markets has jumped about 15% from the lows it hit in December,2011. With the revival of stock markets, IPO will come & join the party. We can see lot more IPO’s in coming couple of months with sentiments getting strong in the market.

Rajesh Singla

Rajesh is the founder & CEO of Stockssavvy, Stocks analyst,financial advisor by choice,software engineer by fate,biker,gamer,cricket lover n enthusiastic person. He believes in doing things not just to get by but to get Ahead...

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