Nureca shares began trading on Dalal Street on Thursday at Rs 634.95 per unit, a strong listing debut over its price band of Rs 396-400 apiece.
Many stocks that emerged as winners belonged to the automobile and metal sectors. Experts, however, believe that further upside to these stocks is limited.
Nureca shares began trading on Dalal Street on Thursday at Rs 634.95 per unit, a strong listing debut over its price band of Rs 396-400 apiece. Nureca shares listed with a 58.74 per cent premium over the IPO price on BSE. While on NSE, the shares got listed at Rs 615 apiece, a 53.75 per cent premium over the issue price. The Rs 100 crore public issue was subscribed 39.93 times during the three-day bidding process. The category meant for qualified institutional buyers (QIBs) was subscribed 3.10 times, non-institutional investors 31.59 times and retail individual investors (RIIs) 166.65 times. The issue received bids for 5.59 crore shares against 14.01 lakh shares on offer. Nureca shares were seen trading at Rs 480, implying a premium of 20 per cent or Rs 80 apiece in the grey market on Thursday. Earlier this week, shares were commanding a grey market premium of 14 per cent in the grey market.
Not more than 75 per cent of Nureca’s IPO was reserved for Qualified Institutional Buyers (QIB). The company had reserved 10 per cent of the issue for the retail investors and the remaining 15 per cent for Non-Institutional category. The issue also included a reservation of equity shares worth Rs 50 lakh for subscription by eligible employees. A discount of Rs 20 per share was also offered to eligible employees who placed bids in the employee reservation portion. Bidding for the issue was to be in a lot size of 35 equity shares and multiples thereafter.
Nureca has a well-diversified product portfolio including chronic device products, orthopaedic products, mother and child products, nutrition supplements, and lifestyle products to meet the Indian healthcare market requirements. It is the first digital company to sell such products through its website drtust.in and other online partners i.e. e-commerce players, retailers, and distributors. Analysts had mixed views on the Nureca issue. Those at Reliance Securities had said that given the huge opportunity in the home healthcare segment, growth momentum might sustain in subsequent years. They had given ‘subscribe’ rating to the issue.
While those at BP Equities Pvt. Ltd. (Institutional Equities), had recommended to ‘avoid’ the issue. Analysts said that on the valuation front, at the upper price band, the company is valued at 63x P/E based on FY20 numbers considering the diluted equity shares. “However, we feel the valuation is very stretched and the future growth sustainability remains a cause of concern for long term outlook,” they added.
(The stock recommendations in this story are by the respective research and brokerage firms. Financial Express Online does not bear any responsibility for their investment advice. Please consult your investment advisor before investing.)