Delhi bike dealer gets Rs 4,800 crore bids for Rs 12 crore IPO

The Rs 12 crore IPO has been oversubscribed nearly 400 times.

Resourceful Automobile, a Delhi-based 2-wheeler dealership, has received bids worth around Rs 4,800 crore for its Initial Public Offering (IPO). The Rs 12 crore IPO has been oversubscribed nearly 400 times.

The high subscription figures for a Small & Medium Enterprises (SME) IPO have baffled investors. This was despite the company reporting a negative cash flow of Rs 19.33 lakh for the period ending October 31, 2023.

Resourceful Automobile offered 10.2 lakh shares at a fixed price of Rs 117. The issue opened on August 22 and closed on August 26. According to reports, retail investors were the most active, with aggregate demand at 24.1 crore shares, while the total demand for high net-worth investors was nearly 150 times the total offer size.

As per reports, merchant banker Swastika Investmart had marketed the IPO like any other one that would be subscribed by “5-10-20” times. However, the high subscription numbers were beyond anyone’s expectations.

The company plans to use proceeds from the IPO to expand its operations and repay its debt. It currently operates two Yamaha showrooms in Delhi with a small workforce of just 8 employees.