NTPC Green Energy IPO: Retail category booked nearly 2 times on Day 2; Here’s list of upcoming IPOs with shareholder quota

The ₹10,000-crore book-building issue has a reservation of 10% of its issue size for existing shareholders of its parent company, NTPC Limited.

When a subsidiary of a listed company files its RHP, some shares are reserved for shareholders of the parent company. This is known as shareholder quota. Typically the shareholder quota comprises 5% to 15% of the total offer size.

As the IPO frenzy continues in the primary markets, the demand for new public issues also increases. The option to apply under the shareholder quota and the retail/non-institutional investor category can boost an applicant’s chances of share allotment. Thus, holding a few shares of companies with subsidiaries that are likely to go public can benefit investors.

HDB Finance IPO

Earlier on October 31, HDB Financial Services filed a Draft Red Herring Prospectus (DRHP) with SEBI for an initial public offering of up to ₹12,500 crore. The public issue consists of a fresh issuance of shares aggregating up to ₹2,500 crore and an offer for sale of shares aggregating up to ₹1,000 crore by existing shareholders of the company. The public issue is likely to have a reservation for shareholders of the company’s parent, HDFC Bank. IPO proceeds from the fresh issue will be used to strengthen the company's Tier-I capital base to support future capital needs.

In FY24, HDB Financial Services reported total revenue from operations at ₹14,171 crore, up 14% YoY compared to the previous year. Net profit for the year also rose to ₹2,460 crore in FY24 from ₹1,959 crore in FY23.

Hero FinCorp IPO

Belstar Microfinance IPO

Belstar Microfinance Limited is a subsidiary of listed company, Muthoot Finance. Belstar Microfinance has received SEBI’s nod to launch an IPO comprising a fresh issue of ₹1,000 crore and an Offer-For-Sale (OFS) of ₹300 crore.

Belstar Microfinance IPO might reserve a portion of its offer size for Muthoot Finance shareholders. Details of the shareholder quota will be finalised once the company files its RHP.

Asirvad Micro Finance IPO

Asirvad Micro Finance Limited is a subsidiary of the listed Non-Banking Finance Company Manappuram Finance. On April 30, the market regulator SEBI approved the company’s plan to raise funds through an initial public offer.

According to the Draft Red Herring Prospectus (DRHP), the Asirvad Microfinance IPO consists of a fresh issue of shares aimed at raising ₹1,500 crore. The issue is likely to have a reservation for shareholders of the parent company, Manappuram Finance. However, this will be confirmed once the company files its red herring prospectus (RHP) with SEBI.

IPOs of PSU subsidiaries

Subsidiaries of public-sector companies such as SJVN Green Energy, ONGC Green Energy, Bharat Coking Coal, Central Mine Planning and Design Institute, and NLC India Renewables Ltd (NLCIRL) are also likely to tap the primary market for funds. The public issues of these subsidiaries are likely to have a reservation for the shareholders of the parent companies, such as Coal India, NLC India, SJVN Ltd, and ONGC Ltd.

Ather Energy IPO

Electric two-wheeler maker Ather Energy Ltd filed its draft papers for an IPO with the SEBI on September 9. The public issue will include a fresh issuance of shares worth ₹3,100 crore and an offer for sale of up to 2.2 crore shares by investors and promoters of the company such as Tarun Sanjay Mehta and Swapnil Babanlal Jain. Corporate shareholders such as Caladium Investment Pte Ltd, National Investment and Infrastructure Fund II and 3State Ventures Pte Ltd will also dilute their shareholding in the company.

Ather Energy is a subsidiary of bike-maker Hero MotoCorp. It is likely that the Ather Energy IPO will have a portion of shares set aside for shareholders of Hero MotoCorp.