DB Corp attracts 25% premium

Settles at Rs 265.90 on BSE
Shares of DB Corp settled at Rs 265.90 on the BSE, a premium of 25.40% over the initial public offer price of Rs 212.
The stock debuted at Rs 250, a 17.90% premium over the initial public offer (IPO) price. The stock hit a high of Rs 274.60 and a low of Rs 235.50. The counter clocked a volume 1.99 crore shares on the BSE.
The current price of Rs 265.90 discounts the company's half-year ended September 2009 annualised consolidated EPS of Rs 10.50 by a PE multiple of 25.32.
DB Corp had fixed the issue price at Rs 212 per share, at the top end of the Rs 185-212 per share price band. Retail investors were given a discount of Rs 2 per equity share over the issue price. The initial public offer (IPO) of DB Corp, which remained open between 11 and 15 December 2009, was subscribed 39.54 times. The IPO received bids for 58.92 crore shares as against 1.49 crore shares on offer.
The qualified institutional buyers (QIBs) category was oversubscribed by a staggering 68.52 times. The non-institutional investors category was oversubscribed 26.17 times and the retail investors category was oversubscribed 3.42 times.
DB Corp came out with an IPO of 1.81 crore shares with the face value Rs 10 each. The firm had placed 32.71 lakh equity shares to nine anchor investors. The anchor investors, FID Funds (Mauritius), FIL Trustee Company, Nomura Funds Ireland- India Equity Funds, ICICI Prudential Life Insurance Company, IDFC Classic Equity Fund, Government of Singapore, Reliance Capital Trustee Company, India Capital Fund, BNP Paribas Arbitrage, all committed at the upper end of the price band of Rs 212
DB Corp is in the business of print media, and publishes 7 newspapers, 48 newspaper editions and 128 sub-editions in three languages (Hindi, Gujarati and English) across 11 states. A chunk of the IPO proceeds will be used to consolidate the company's position in existing markets by upgrading infrastructure. It will also enter some new markets by setting up publishing units.
DB Corp also plans to utilise Rs 110 crore to repay debt and Rs 20 crore to lower working capital loans. The company is focusing on increasing its reach in Tier II and III cities where consumption is growing at a faster pace and is higher than Tier I cities.
The company's consolidated net profit declined 37.14% to Rs 47.70 crore on 11.56% rise in consolidated net sales to Rs 948.99 crore in the year ended March 2009 over the year ended March 2008.