The scrip is exchanging hands at a premium of Rs 25-30, about 10% over its issue price of Rs 300.
Analysts tracking the grey market said the issue received a strong response from institutional bidders which boosted the sentiments over the issue. One can expect a mildly positive listing for the stock.
Abhay Doshi, co-founder at UnlistedArena said the company received a strong response from QIB bidders which pushed the morale of investors despite aggressive pricing. “One can expect 10-15% returns on debut.”
Bikaji Foods is India’s third-largest ethnic snack company. The company’s product range includes six principal categories: bhujia, namkeen, packaged sweets, papad, and western snacks among others.
A few other analysts, given rich valuations of the company and muted business profile, suggested booking profits following a listing pop.
Arijit Malakar, Head of Research – Retail, Ashika Group said that Bikaji Foods International’s IPO is expensively valued, which leaves little room for upside in a volatile market.
The company’s Rs 881-crore IPO was sold in the range of Rs 285-300 per share and received a strong investor response. The IPO was subscribed over 26.67 times between November 3-7.
The quota reserved for qualified institutional buyers (QIBs) was subscribed 80.6 times while those reserved for non-institutional investors (NIIs), retailers and employees were subscribed 7.1 times 4.77 times and 4.38 times, respectively.
Pravesh Gour, Senior Technical Analyst, Swastika Investmart said the issue received a good response from investors on both the institutional as well as retail side, and the current grey market premium is around 10%.
“The company’s margins are on the declining side and a P/E valuation looks expensive. We advise investors to lock in listing gains, and only aggressive investors should consider it for a long-term commitment.”
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