The initial trading day of Capillary Technologies India Limited’s IPO saw a cautious start, with moderate interest from investors. By the end of the first day, the public offering had garnered a subscription of 0.28 times, with approximately 23.68 lakh bids received against the 83.83 lakh shares available.
Commencing on November 14, the IPO is set to conclude on November 18. Retail investors subscribed 0.26 times, while the non-institutional category reached 0.28 times. The Qualified Institutional Buyer (QIB) segment saw a subscription of 0.29 times, and the employee portion was subscribed 0.87 times. Despite the company’s robust anchor book, investors seem to be approaching the investment opportunity cautiously.
A day ahead of the IPO launch, Capillary Technologies secured Rs 394 crore from anchor investors, including HSBC Global Investment Funds – Asia Ex Japan Equity Smaller Companies, SBI Technology Opportunity Fund, ICICI Prudential Innovation Fund, Kotak Pioneer Fund, Axis Multicap Fund, Aditya Birla Sun Life Digital India Fund, and Amundi Funds New Silk Road.
The grey market premium for Capillary Technologies has decreased recently, with the latest premium standing at Rs 23, down from around Rs 50 a few days ago. Based on the current premium, the anticipated listing price is approximately Rs 600, representing a potential gain of about 4% over the upper price band of Rs 577. The decline in the grey market premium indicates a temporary cooling of sentiment, though long-term interest in the company’s business model remains evident.
Capillary Technologies, headquartered in Bengaluru, is an enterprise Software as a Service (SaaS) firm operating globally. The company specializes in customer engagement and loyalty management using AI and machine learning. Its products, such as Engage+ and Co-Pilot tools, assist enterprises in executing personalized marketing campaigns and data-driven decision-making swiftly. With a scalable cloud-native infrastructure, Capillary Technologies caters to international clients seeking digital transformation and customer retention solutions.
IDBI Capital has recommended a “Subscribe” rating for long-term investors considering the IPO. The brokerage firm believes that Capillary Technologies is well-positioned to capitalize on the increasing global demand for AI-driven marketing, loyalty programs, and predictive engagement tools. The company’s AI-powered solutions, expanding customer base, and cloud-native architecture provide a solid growth trajectory. The ongoing shift towards digital transformation and enterprise loyalty solutions further bolsters its long-term potential.
The IPO offers long-term investors exposure to a burgeoning global SaaS player in a sector attracting substantial enterprise spending. IDBI Capital’s endorsement underscores confidence in the company’s growth prospects. However, caution is advised for short-term investors, given the significant drop in the grey market premium and the moderate subscription rates on the first day, indicating ongoing market evaluation. Potential listing gains, based on current market sentiment, may be limited.
In essence, the IPO appears more suitable for patient long-term investors, while those seeking immediate gains may opt to adopt a wait-and-watch approach.