Garden Reach Shipbuilders & Engineers has joined the league of firms whose shares are available in the secondary market at a price lower than that in their IPO. Shares of the company ended 13 per cent over their IPO price after their stock market debut, on Wednesday.
Shares of more than 60 per cent of companies that have listed since 2017 are currently below their IPO price. The latest correction in the market has further weighed on the performance, with shares of almost all 58 stocks coming of at least 15 per cent from their peak.
Barring half a dozen companies, the secondary market performance for most firms has been tepid. This is despite huge demand for shares during the IPO. Investment experts say the poor scorecard will weigh on investor appetite for forthcoming IPOs.
Investors are better off buying shares of existing companies rather than investing in IPOs if there are no gains to be made, said an expert.
