 "Mobikwik leads IPO debut with 90% surge; Vishal, Sai Life gain around 40%")
All the three companies that made their stock market debut on Wednesday delivered huge day-one gains for investors.
Shares of digital payment major One Mobikwik Systems surged 90 per cent, while that of fashion retailer Vishal Mega Mart and pharma firm Sai Life Sciences gained around 40 per cent each.
These stellar debuts came despite the benchmark indices logging continuous declines since their initial public offerings (IPOs) closed on Friday.
The maiden share sales, however, had evoked strong response from investors, drawing cumulative bids worth Rs 2.2 trillion.
Vishal Mega Mart’s Rs 8,000-crore IPO — fifth largest of the year — had garnered 27.3x subscription.
Shares of Vishal Mega Mart ended at Rs 112, up Rs 34, or 44 per cent, over the issue price of Rs 78. At the last close, the Gurugram-based value retailer was valued at Rs 50,475 crore.
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Mobikwik closed at Rs 530, up Rs 251.3, or 90.1 per cent, over its issue price of Rs 279. At the last close, the Gurugram-based fintech firm was valued at Rs 4,120 crore. Mobikwik’s Rs 572-crore IPO was subscribed 120 times.
Despite getting a relatively modest response of 10x, Sai Life’s shares ended at Rs 765, up Rs 216, or 39.4 per cent, over issue price of Rs 549.
The contract research, development, and manufacturing organisation (CDMO) is now valued at Rs 15,917 crore.
“For the Vishal Megamart IPO, we had a positive view both on a short and long-term basis. Even though there are handsome gains on Day One, we advise investors to hold on to the stock, as it has good growth prospects compared to peers. We were not convinced about the valuations of Sai Life or One Mobikwik, and we would advise profit-taking. Mobikwik’s recent growth and profitability is unconvincing, while Sai Life’s pricing is aggressive relative to peers,” said Geetanjali Kedia, senior research analyst, Sptulsian.com
The successful debuts are expected to boost the IPO market, with eight new issuances lined up.
Five IPOs, including Concord Enviro Systems and Transrail Lighting, open on Thursday, aiming to raise a combined Rs 2,900 crore. Another three IPOs, including Ventive Hospitality and Carraro India, will open on Friday, targeting a cumulative Rs 3,432 crore.
The IPO market had slowed down after the Nifty 50 index dropped 10 per cent from its September highs.
Recent IPOs, such as those of Hyundai Motor India and Swiggy, saw lukewarm responses and poor post-listing performance, with subscriptions ranging from 1-4 times.