Book building: Hi-Tech Lubricants raises Rs1.35 billion

Share offer over-subscribed by 2.24 times

LAHORE:

The book-building process for Hi-Tech Lubricants Limited has been over-subscribed by 2.24 times in the first stage of Initial Public Offering (IPO) of the company, which closed on Friday.

According to a press release, shares of the company were offered at a base price of Rs37 per share, but due to high demand during the two-day book-building process, the closing strike price touched Rs62.50 per share.



In book building, only corporate entities and high-net worth individuals can bid for shares. The company was able to raise Rs1.35 billion from the offer, which made available 75% or 21.75 million shares out of the IPO for 29 million shares. Investors had offered bids for 48.674 million shares of the company.

In the next stage of the IPO, the remaining 25% or 7.25 million shares will be offered to general public at the strike price of Rs62.50. The company is expected to raise another Rs453 million, which will take proceeds of the IPO to Rs1.8 billion.

Arif Habib Limited is the lead manager, arranger and book runner for both the IPO segments.



Commenting on the investor response to the book building, Hi-Tech Lubricants Director Shaukat Hassan stated the board and management of the company were thankful to the investors for showing confidence in future of the company.

“We are also extremely happy to become the first-ever listed company after the formation of Pakistan Stock Exchange (PSX),” he said.

Hi-Tech Lubricants says it has a 13.6% market share in the passenger car motor oil segment and an overall 5.5% share in the machine lubricant market in Pakistan. Hi-Tech’s product portfolio, under the brand name ZIC, includes a wide range of specialty lubricants in automotive, industrial and marine segments, which are imported from SK Lubricants, South Korea.

Published in The Express Tribune, January 10^th, 2016.

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