IPOs galore: Five companies are scheduled to launch IPOs worth over Rs 7,000 crore this coming week, which is expected to result in significant activity on the primary market in India. Experts suggest that investors subscribe to these issues, if only for the initial listing gains, as the favorable sentiment in the secondary market may help these initial public offerings. According to an ET report, given the limited amount of funds available for investments, retail investors are advised to prioritize Tata Technologies and IREDA over other options.
The surge of Initial public offerings (IPOs) in such a short period is not expected to affect main market liquidity, according to bankers. There won’t be much of an impact on the overall market, according to Satyen Shah, President of Nuvama Investment Banking and Fixed Income, even though funds from one issue might not be available for another. He did, however, concede that, unlike institutional and high-net-worth investors who have access to sufficient capital, retail investors may use discretion based on the companies’ sectors and valuation.
IPOs for Tata Technologies
Value of IPO: Rs 3,042 crore
Cost Range: Rs. 475–500
Dates of Open and Close: November 22–24
The first initial public offering (IPOs) from the Tata Group in more than 20 years is Tata Technologies, with an IPO size of Rs 3,042 crore and a price range of Rs 475–500. Citing the IPO’s growth prospects and comparatively lower valuations than its peers, analysts advise investing in it. While recommending’subscribe’ to the Tata Technologies IPO, IDBI Capital points out that the company is valued at 33 times FY23 earnings in the issue, compared to 63 times for its competitors. Experts in the market predict strong demand for this IPO. Smaller retail investors, however, might have trouble obtaining allotment, according to Arun Kejriwal, founder of investment consulting firm KRIS.
IPO of IREDA
Value of IPO: Rs. 2,150 crore
Cost Range: Rs. 30-32
Dates of Open and Close: November 21–23
With an IPOs size of Rs 2,150 crore and a price range of Rs 30-32, IREDA, a state-owned finance company that funds renewable energy projects, is being offered for sale. Experts advise investing in this initial public offering (IPO) because IREDA is positioned to gain from the government’s heightened emphasis on renewable energy. By 2030, the government wants to use renewable energy sources to supply half of the nation’s energy needs.
Investors find IREDA to be an appealing option because of its reasonable price range and the company’s strong performance over the past two years as a result of government support, according to Kejriwal. According to SBI Securities, the company is valued at 1.1 times the price-to-book value at the upper end of the price range. Samco Securities’ research head, Apurva Sheth, advises subscribing to potentially benefit from listing gains.
IPO for Gandhar Oil Refinery
Amount of IPO: Rs 500 crore
Cost Range: INR 160-169
Date of Open-Close: November 22–24
The IPOs size of Gandhar Oil Refinery, which manufactures lubricants, personal care, healthcare, and other products, is Rs 500 crore, with a price range of Rs 160-169. Regarding this IPO, analysts’ opinions differ. Given that the stock is trading in the grey market at a 30% premium to the issue price, some advise subscribing to it to profit from listing. Others, on the other hand, contend that at the issue price, the IPO might not be the best option for long-term investors. Kejriwal compares it to Galaxy, a similarly priced but successful share.
IPO for Flair Writing Industries
Value of IPO: Rs. 593 crore
Cost Range: Rs. 288–304
Date of Open-Close: November 22–24
With an IPO size of Rs 593 crore and a price range of Rs 288–304, Flair Writing Industries is anticipated to gain from the recent Cello World IPO success. Similar expectations are held by market participants regarding the interest that investors will show in Flair’s IPO. Cello World’s shares went public on November 6 at a 28% premium to its issue price.
The IPO of Fedbank Financial Services
Value of IPO: Rs. 1,092 crore
Cost Range: Rs. 133–140
Date of Open-Close: November 22–24
Federal Bank-sponsored non-banking finance company Fedbank Financial Services is holding an initial public offering (IPO) with a value of Rs 1,092 crore and a price range of Rs 133–140. Because the Reserve Bank of India (RBI) recently decided to increase the risk weights on cash credit, personal loans, and consumer durable loans by lenders, analysts believe long-term investors should proceed with caution. The entire banking industry is anticipated to be impacted, even though Fedbank might not be directly impacted. Samco’s Sheth examines the company financials and Draught Red Herring Prospectus (DRHP) and suggests subscribing to the IPO, if only for listing gains.
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