Subscription to GP IPO starts today

Public subscriptions for the shares of Grameenphone, the biggest public offer in Bangladesh history, starts today to mobilize a fund of Tk 4.86 billion.
Subscription to the IPO by resident citizens will close Thursday while it will continue until October 18 for the non-resident Bangladeshis (NRBs).
Interested investors would submit their applications in over 500 centres of 15 commercial banks and the Investment Corporation of Bangladesh.
An individual investor would be able to apply for a lot of 200 shares, each having a face value of Tk 10 and a premium of Tk 60. Institutional investors will have to pay a premium of Tk 64 per share.
Some 69.70 million shares of Tk 4.86 million would be allocated to the public through lottery while 65.70 million shares of Tk 4.86 million have been earmarked for institutions to mobilize a total of Tk 9.73 billion, 7 percent of the total DSE market capitalization.
In exchange, the country’s largest mobile phone operator is selling out only 10 percent stake to the public.
Market analysts foresee an overwhelming response from the investors as they witnessed enthusiasm for collecting IPO application forms from the brokerage houses and from in front of the Dhaka Stock Exchange last week.
“I think the issue would be hugely oversubscribed. It can be considered as a showdown that the capital market has the strength to eat up even bigger issues,” said one of them.
The subscription money of the unsuccessful applicants would be directly credited to their respective bank accounts as the SEC decided last week.
Stockbrokers said the initial trend of fund outflow from the market has already eased up while most of them think that a small number of investors need to withdraw fund from their existing investment to subscribe for the issue of only Tk 14,000 per lot.
They expect that the GP issue would help encourage other big companies to come forward to join the market, which would deepen the market and eventually bode well for mitigating the rumour-based speculative trading.

Courtesy: UNB, Dhaka