Book-building of Pakistan's Octopus Digital resulted in a strike price of Rs40.6 -- the highest possible -- with the initial public offering (IPO) being oversubscribed 27 times at the end of the two-day process on Friday.
The company received offers of over 745.6 million shares against its offer of 27.35 million at the initial price of Rs29 per share.
The IPO was subscribed within the first half hour on the first day (Thursday), with bids continuing to flow, indicating investor interest in the tech sector company.
Octopus Digital is wholly-owned by Avanceon Limited that trades in products of automation and control equipment, and provides related technical services, according to its description on the Pakistan Stock Exchange.
Touted as the first tech IPO in seven years, Octopus Digital focuses on digitalisation solutions for various businesses, apart from providing tech upgradation, and database maintenance services.
IPO: Octopus Digital's book building to be held on September 9, 10
The company aims to develop Digital Dashboard platforms in order to enhance its suite of services and expand its footprint across borders further in the Middle East and US.
Saad Hashmey, executive director at BMA Capital, bookrunner to the issue, said the subscription highlights the potential of Pakistan's capital markets.
"Today was a historic day and highlights the strong potential of our capital markets," Hashmey told Business Recorder after the book-building process. "It shows the unwavering investor appetite for both the tech sector and companies that are backed by sound sponsors with a proven track record."
Pakistan has been seeing a rising trend of listings on the PSX with 8 IPOs offered in FY2020-21 alone. This is in stark contrast to the previous fiscal year when no IPO was offered. In 2009-10, 8 IPOs were made before the number touched 7 in FY15.
However, 7 IPOs were conducted in three years combined, from FY18 to FY20, as Pakistan’s stock market remained under pressure due to slowing economic growth and political uncertainty.
Air Link IPO: Book-building results in strike price of Rs71.5, offer oversubscribed 1.64 times
In August, the book-building of Pakistan's smartphone producer Air Link resulted in a strike price of Rs71.5 with the IPO being oversubscribed 1.64 times at the end of the two-day process.
The company had planned on raising Rs5.85 billion, the largest private-sector IPO in Pakistan's history.
Bids for over 147 million shares were made against the offer for sale of 90 million shares. The company raised Rs6.4 billion in the book-building process.
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