Shares of Uniparts India ended 4.90 percent higher at ₹566 on BSE on December 13.
They had surged more than 7 percent to ₹578.95 in intraday trade on BSE before ending 5 percent higher.
In the previous session on December 12, the stock was listed at ₹575 on BSE with a discount of 0.35 percent over its issue price of ₹577. The stock closed at ₹539.55 on December 12.
The company’s major business areas are agriculture, construction, forestry, etc. and have a leading market presence, a global business model, and long-term relationships with key customers.
The company's IPO was subscribed 4.63 times in the retail category, 67.14 times in the QIB category, and 17.86 times in the NII category.
Uniparts India IPO opened for public subscription on November 30 and closed on December 2. The price band for the offer was ₹548 – 577 rupees per equity share.
What should you do now?
Prashanth Tapse, Research Analyst and Senior VP of Research at Mehta Equities pointed out that Uniparts listed below market expectations and is trading below the IPO price.
"Post-listing investors should focus on long-term holding as the market always rewards a player who has the growth potential and if investors wish to add more, one should accumulate in the range of ₹550-570 with a short-term stop loss below ₹525 and a target price of ₹630," said Tapse.
“Uniparts is the smallest player in the space but has consistent growth in revenues and margin in front of other big players such as Bharat Forge, Balkrishna Industries etc. Considering all the growth rationales, we recommend investors focus on medium to long-term in Uniparts India,” he said.
Akhilesh Jat, Category Manager - Equity Research at CapitalVia Global Research believes Unipart is a good long-term bet.
"The company's financial situation is good. With steady sales and sustained profit growth, rise in top-line and bottom-line, it can be a good long-term investment. One can go for a 'buy on dips' with keeping the stop loss below ₹500," said Jat.
Santosh Meena, Head of Research at Swastika Investmart observed the company saw a muted listing but the issue had received a good response from investors on both the institutional and retail sides.
Meena underscored that the company enjoys a healthy financial position with continuous growth in revenue and profit and improving margins.
As for the risk factor, the issue is a complete offer for sale, said Meena. However, he added that the issue is attractively priced at a P/E valuation of 15.61, which is lower than its listed peers.
"Allottees who applied for the public offering for listing premium are advised to maintain their stop loss at ₹535," said Meena.
Disclaimer: The views and recommendations given in this article are those of individual analysts and broking firms. These do not represent the views of MintGenie.
