After a dreamy listing, shares of DreamFolks Services fell over 5 percent in intra-day deals on Wednesday. The scrip made a solid market debut on Tuesday, listing at ₹508.70 on NSE at a 56 percent premium over its issue price of ₹326. Meanwhile, on BSE, it debuted at ₹505 on BSE, up 54.91 percent from the issue price.
The stock further extended gains to touch the day's high of ₹549 in intra-day deals on Tuesday, which is a premium of 68 percent over the IPO price. It ended its listing day at a 42 percent premium at ₹463 on NSE.
However, in today's deals, the stock fell as much as 5.6 percent to its day's low of ₹436, which is still at around 34 percent premium to its IPO price.
But should you book profits now in the scrip or hold it for better long-term gains? Analysts noted that the company’s superb listing can be attributed to positive market sentiments, bright future prospects, and a phenomenal response from investors. Let's see they say.
Naveen Kulkarni, Chief Investment Officer, Axis Securities believes investors should consider holding the stock for future potential gains.
"Dreamfolks got listed at a 56% premium to its issue price of ₹508 per share. With robust growth in passenger air traffic, we expect a potential upside to the company’s business operations moving ahead. Against this backdrop, investors who have invested in the IPO may hold the stock for the long-term horizon. Investors with moderate risk appetite may consider investing in the stock post-listing," Kulkarni said.
However, Nirvi Ashar, Manager of Fundamental Research, Religare Broking believes that investors should book profit now.
"Yes, investors should book profit in DreamFolks IPO as we believe stake dilution by the promoter and rich valuation provides a limited scope of upside," Ashar noted.
Angel One also believes that the stellar listing of the stock leaves little room for future upside and recommends booking profits.
DreamFolks Services IPO was open between August 24 and August 26. The ₹562-crore issue was subscribed a solid 56.68 times, with the qualified institutional investor quota getting subscribed by 70.53 times, NII quota by 37.66 times and retail quota by 43.66 times.
Incorporated in 2008, DreamFolks is India’s largest airport service aggregator platform and has no listed peers at the bourses. The company consumers' access to airport-related services like lounges, food and beverages, spa, meet and assist airport transfer, transit hotels or nap room access, and baggage transfer services.
Currently, the firm facilitates all the 54 lounges operational in India and enjoys a market share of over 80 percent in the domestic lounge access market. It also commands a market share of over 95 percent of all credit card and debit card access to airport lounges at the end of fiscal 2021-22 (FY22).