Zomato Ltd., the Indian food delivery startup backed by Jack Ma Yun’s Ant Group, got about 35 times more bids from anchor investors than it intended to sell in its blockbuster initial public offering, according to people with knowledge of the matter, Bloomberg reports.
The Gurgaon-based firm received bids worth 1.5 trillion rupees (US$20 billion) from large funds compared with the 42 billion rupees offered, the people said, asking not to be identified as the information is private.
The subscription marks one of the most popular Indian IPOs among institutional investors in recent years as Zomato starts taking public orders for the US$1.3 billion share sale on Wednesday.
Zomato allocated about 552 million shares to 186 anchor investors including funds managed by BlackRock Inc. and Fidelity International as well as New World Fund and Tiger Global, according to a Tuesday filing, which didn’t provide any subscription figures.
The shares were sold at 76 rupees each to the anchor investors, the top of a marketed range with a minimum price of 72 rupees.
The interest follows a blistering rally in Indian stocks this year, and signals confidence in the market debut of the country’s first real consumer internet offering. Zomato recently raised its IPO target by 14 percent as demand grew in a fast-growing Indian food-services market that Sanford C. Bernstein & Co. estimates will balloon to US$97 billion by 2025.
Zomato is selling about 90 billion rupees worth of new shares in the IPO, while its shareholder Info Edge (India) is offering 3.75 billion rupees worth of stocks, according to terms of the deal obtained by Bloomberg News.