The initial public offering (IPO) of PKH Ventures was withdrawn on the back of weak reception by investors till the last date of bidding. The issue, which opened for subscription on June 30, remained undersubscribed till its final day, July 4 mainly dragged by the poor response of qualified institutional buyers (QIBs).
The issue was subscribed just 65 percent on the final day of bidding, July 4, 2023. The company received bids for 1.67 crore shares against 2.56 crore shares on offer, according to data from the BSE.
While the non-institutional investor (NII) portion was oversubscribed, 1.67 times and the retail investors' quota saw 99 percent bids, the major disappointment was the QIBs. The portion reserved for them was subscribed just 11 percent.
"PKH Ventures has informed the exchange that on account of non-fulfillment of commitment by the qualified institutional buyers, the issuer has now decided to withdraw the issue in consultation with book running lead managers and the registrar. Hence, the IPO of PKH Ventures Limited will be treated as withdrawn," said NSE.
One must note that for any IPO to be successful, the QIB portion has to get a minimum of 90 percent subscription, which was not fulfilled by PKH Ventures IPO.
PKH Ventures was planning to raise ₹379 crore via its IPO. The issue comprised of fresh equity issue of up to 1.82 crore shares worth ₹270.2 crore and an offer for sale (OFS) of up to 73.7 lakh equity shares worth ₹109 crore by promoters. The company had set a price range of ₹140-148 for the IPO.
The net offer was reserved for qualified institutional buyers at 50 percent of the total offer size, retail investors at 35 percent, and non-institutional investors at 15 percent.
PKH Ventures is engaged in the business of construction and development, hospitality, and management services. Incorporated in 2000, the company began its journey by managing and operating various hospitality establishments across airports in the country. This experience laid the foundation for the company's Hospitality vertical.
In FY 2015, PKH Ventures developed and started owning, managing, and operating two hotels in Mumbai: Golden Chariot Hotel & Spa in Vasai and Golden Chariot, The Boutique Hotel near Mumbai International Airport.
The company had planned to use ₹124.11 crore from issue proceeds for equity investment in the Halaipani Hydro Power Project and ₹80 crore towards equity investment in a subsidiary company, Garuda Construction, to fund its working capital requirements. Further, the company also planned to use ₹40 crore for pursuing inorganic growth opportunities through acquisitions, other strategic initiatives, and general corporate purposes.
