The initial public offering (IPO) of Bengaluru-based Tejas Networks hit the market on Wednesday and the issue got subscribed 11 per cent on the first day of offer till 5 pm (IST). Data from stock exchanges showed that the IPO received bids for 18,03,065 shares against the total issue size of 1,71,12,005 shares.Tejas Networks on Tuesday raised around Rs 350 crore from 17 anchor investors. The company has fixed the price band of the IPO in the Rs 250-257 range. The issue will close on Friday. Shares of the company are proposed to be listed on both BSE and NSE.Over 1.35 crore shares have been allotted to anchor investors at the upper end of the price band.The issue is a combination of fresh issue of shares and offer for sale. At the upper end of the price band, the fresh issue of shares would be worth Rs 450 crore and offer for sale Rs 326 crore. Proceeds of the IPO will be utilised mainly for R&D investment and working capital requirement.Brokerage firm IDBI Capital has given a ‘subscribe’ rating on the issue. “In the price band of Rs 250-257, Tejas Networks’ implied price-to-earnings ratio would be 25 times FY17 adjusted earnings per share (EPS) of Rs 10.2, which we believe is reasonable given the revenue or earnings growth potential over the next 3-5 years. The company provides a good investment option on capex of telecom companies in India and other markets to feed the data hungry markets,” IDBI Capital said in a research note.Tejas is the second largest optical networking products company in India with around 15 per cent market share. The optical equipment capex in India is expected to grow at CAGR of 14.2 per cent over 2014-2020 to $869 million in 2020. Further, company’s focus on other emerging markets should enable it to deliver strong growth.GEPL Capital in a research report said, “Tejas Networks stands to gain from operating leverage. At a price-to-earnings ratio (P/E) of 27.34 times FY17 EPS, it demands a discount to its domestic peers. We assign a ‘subscribe’ rating to the issue.”