60% listing gains in bad market! What really powered Capacit’e bold show
, ETMarkets.com|
Updated: Sep 25, 2017, 12.46 PM IST
Impressive listing of the Capacit’e Infraprojects stock on the bourses made some investors smile on Monday even as dark clouds hovered over both primary and secondary markets on Dalal Street.
An FII selloff and brisk profit booking dragged the benchmark Sensex some 300 points in morning trade on the back of nearly 500 points correction on Friday.
The BSE Sensex traded below 31,700 in morning trade, while Nifty slipped below the 9,900 mark on Monday.
For the whole of last week, equity benchmarks Sensex and Nifty plunged over 1 per cent each. And matrimonial service provider Matrimony.com had a poor listing, which dampened sentiment in primary market, leading to less-than-expected subscription levels for two major insurance IPOs, ICICI Lombard and SBI Life.
In this backdrop, Capacit’e Infraprojects’ listing at 60 per cent premium to the issue price came as a whiff of fresh air. Shares of the Mumbai-based construction firm got listed at Rs 399 against the issue price of Rs 250. The stock traded 45 per cent higher from issue price at Rs 362 around 11 am.
Most market experts had given a ‘subscribe’ rating to the IPO, citing attractive pricing, robust order book and good balance sheet, which helped the issue draw 180 times oversubscription.
“CIL has an impressive order book worth Rs 4,602 crore, which is four-times its FY17 revenue. At an upper end of the price band at Rs 250, CIL is available at a reasonable valuation of 24 times on FY17 EPS (post IPO dilution). Better return ratio and less leveraged balance sheet support that valuation,” Geojit Financial Services said in a note.
KR Choksey Shares and Securities said an increase in urban population, growth in per capita income, nuclearisation of families, healthy growth in services sector and favourable interest rates should act as the key triggers for top-line growth of the company. Subsequently, under-taking of projects on design-build and lock-and-key basis should result into considerable increase in the company’s operating margins.
The stock valuation is reasonable given the prolific market size and potential to grow besides robust financial performance over FY14-FY17, the brokerage said
Last week, Matrimony.com made a poor debut on BSE, listing at issue price. The scrip has been included in the list of 'B' Group of securities on BSE. The stock traded lower at Rs 823 on Friday.
Market veterans say Indian IPO investors have matured over time and they are only going for issues that are priced attractively.
Subdued listing of Matrimony.com scared many investors, but in a way, this will have a good side-effect that new IPOs will henceforth be fairly priced, leaving some money on the table for investors, said Jimeet Modi, CEO, Samco Securities.
An FII selloff and brisk profit booking dragged the benchmark Sensex some 300 points in morning trade on the back of nearly 500 points correction on Friday.
The BSE Sensex traded below 31,700 in morning trade, while Nifty slipped below the 9,900 mark on Monday.
For the whole of last week, equity benchmarks Sensex and Nifty plunged over 1 per cent each. And matrimonial service provider Matrimony.com had a poor listing, which dampened sentiment in primary market, leading to less-than-expected subscription levels for two major insurance IPOs, ICICI Lombard and SBI Life.
In this backdrop, Capacit’e Infraprojects’ listing at 60 per cent premium to the issue price came as a whiff of fresh air. Shares of the Mumbai-based construction firm got listed at Rs 399 against the issue price of Rs 250. The stock traded 45 per cent higher from issue price at Rs 362 around 11 am.
Most market experts had given a ‘subscribe’ rating to the IPO, citing attractive pricing, robust order book and good balance sheet, which helped the issue draw 180 times oversubscription.
“CIL has an impressive order book worth Rs 4,602 crore, which is four-times its FY17 revenue. At an upper end of the price band at Rs 250, CIL is available at a reasonable valuation of 24 times on FY17 EPS (post IPO dilution). Better return ratio and less leveraged balance sheet support that valuation,” Geojit Financial Services said in a note.
KR Choksey Shares and Securities said an increase in urban population, growth in per capita income, nuclearisation of families, healthy growth in services sector and favourable interest rates should act as the key triggers for top-line growth of the company. Subsequently, under-taking of projects on design-build and lock-and-key basis should result into considerable increase in the company’s operating margins.
The stock valuation is reasonable given the prolific market size and potential to grow besides robust financial performance over FY14-FY17, the brokerage said
Last week, Matrimony.com made a poor debut on BSE, listing at issue price. The scrip has been included in the list of 'B' Group of securities on BSE. The stock traded lower at Rs 823 on Friday.
Market veterans say Indian IPO investors have matured over time and they are only going for issues that are priced attractively.
Subdued listing of Matrimony.com scared many investors, but in a way, this will have a good side-effect that new IPOs will henceforth be fairly priced, leaving some money on the table for investors, said Jimeet Modi, CEO, Samco Securities.
