Route Mobile share price doubles at stock market debut; stock opens at 105% premium to IPO price

The cloud communications service supplier, which was open for subscription from September Sep 11, within the price band of Rs 345-350

Route Mobile shares skyrocketed on the stock market debut right now and traded at a price of Rs 708 per share, a premium of Rs 358 on the higher band of the difficulty price of Rs Rs 345-350 per fairness. The stock was listed on the BSE at a price of Rs 708 per share. Route Mobile scrip obtained listed at Rs 717, a 104.86 per cent premium over its situation price of Rs 350 on NSE. Route Mobile was buying and selling at a premium of Rs 312 per share within the gray market forward of opening. The Rs 600-crore Route Mobile IPO acquired response, subscribing over 74 instances on the ultimate day of the bidding. Non-Institutional Investors (NII) had bid essentially the most for the stock.

The cloud communications service supplier, which was open for subscription from September Sep 11, within the price band of Rs 345-350, acquired bids for over 89 crore shares as in opposition to the full situation measurement of 1.21 crore shares. At the top of the three-day bidding course of, Qualified institutional patrons (QIBs) class was subscribed 91 instances, whereas non-institutional buyers (NIIs) subscribed their portion 195.61 instances. The retail particular person buyers (RIIs) garnered 12.85 instances subscription. The Mumbai-headquartered firm amassed Rs 180 crore from anchor 15 buyers earlier than the difficulty opened for subscription. The IPO included a contemporary situation of Rs 240 crore and provide on the market (OFS) of up to Rs 360 crore.

In the final 5 months, lots of new retail buyers have come into the market. Hemang Jani, Head – Equity Strategy, Broking & Distribution, Motilal Oswal Financial Services Ltd mentioned that since there had not been any profitable IPO alternatives since March, so retail buyers participated closely in these current IPOs. They had been attracted by a robust gray market premium which has the potential to give substantial itemizing positive factors. Further, the current IPOs thus far had been good gives that got here after a very long time. “With the rising interest in midcaps and small caps, investors were on the look-out for new ideas to invest in and these IPOs provided them the same,” he added. In addition, Jani additionally mentioned that with rates of interest being very low, and the gray market premium operating excessive, it offered a profitable alternative for retail buyers to take part in these IPOs.

Research and brokerage agency Motilal Oswal Financial Services in an IPO notice highlighted that at the upper finish of the price band, the difficulty is valued at 29x FY20 P/E (totally diluted), which is comparable to mid-sized IT companies (no listed friends out there). It additional said that Route Mobile has a robust presence within the area of interest CPaaS market with excessive entry obstacles and wholesome financials. “Further given the small offer size and presence in niche IT space, one may get listing gains too,” it mentioned.

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