An Auto parts firm e known private sector firm, Samvardhana Motherson Finance (SMFL) has announced its decision to withdraw a Rs 1,665 crore Initial Public Offering (IPO) on Friday.

The decision to cancel the issue as nervous investors expressed concerns over the price and foreign investors were worried over government’s plan to review the double taxation avoidance agreement (DTAA) with Mauritius.

The IPO that opened on May 2 was merely subscribed just 0.38 times till 7 pm on the closing day of the issue, according to data available on the (NSE) website. Experts said that the company had launched the IPO after getting backing from some offshore funds, however factors like the continuing fall in the value of the rupee and investor concerns relating to various provisions of the GAAR resulted in a below average IPO performance.

The situation was made with the announcement of the review of the DTAA with Mauritius, though which a large number of foreign funds channel their investments into the country in order to save on taxes.

SMFL owns the listed auto components player Motherson Sumi. The founder, Vivek Chaand Sehgal and his family controls 90.35% stake and the company was planning to raise about Rs 1,665 crore in the issue. A price band of Rs 113 to Rs 118 was set for the IPO by the company.

Standard Chartered Securities and JP Morgan India were the book-running lead managers, while ratings agency Icra graded the issue at 4, indicating above-average fundamentals.