Shares of Quadrant Future Tek Ltd hit an upper circuit of 20 per cent during the trading session on Tuesday as the latest debutant of Dalal Street saw a strong demand from investors following its listing. However, the listing of Quadrant Future Tek was below the expected line.
Quadrant Future Tek shares were listed at Rs 374 on BSE, a premium of 28.97 per cent over its issue price of Rs 290. Similarly, it was listed at Rs 370 on NSE, about 27.59 per cent higher above its issue price. The stock zoomed another 20 per cent to Rs 448.75 on its maiden trading session, locked in the 20 per cent buyer's circuit, taking the overall gains to 55 per cent over the issue price.
The sharp and sudden spike in the stock price of Quadrant Future Tek prices has left investors baffled if they should book the profits in the counter or hold it for a longer run. Some analysts are suggesting it as a long term buy while others are suggesting investors to book partial profits considering the current market sentiments.
Quadrant Future Tek listing was healthy but slightly below street expectations. The demand was on the back of being a niche player specializing in advanced railway signalling systems and specialty cables and a key contributor to the modernization of Indian Railways under the KAVACH initiative and diversified portfolio, said Prashanth Tapse, Senior VP (Research) at Mehta Equities.
"Considering the market volatility, we recommend conservative allotted investors can think of booking profits. While long term investors should consider to 'hold for long term' despite knowing short term volatility post listing & risk in the markets. For non-allotted investors, we advise to accumulate if we get dips post listing due to profit booking attempts,” Tapse suggested.
The IPO of Quadrant Future Tek was open for subscription between January 07 and January 09. It had sold its shares in the price band of Rs 275-290 per share with a lot size of 50 shares. The Mohali-based company raised a total of Rs 290 crore from its IPO, which was entirely a fresh share sale of 1,00,00,000 equity shares. The issue was overall subscribed a stellar 186.66 times.
The Quadrant Future Tek's IPO generated significant investor interest, with a strong subscription and was listed on a notable 29 per cent premium at Rs 374 over its issue price, marking a successful stock market debut, said Shivani Nyati, Head of Wealth at Swastika Investmart.
However, Quadrant Future Tek has Strong historical growth, but recent half-year results have been negative. The IPO participants may book a portion of their profit and hold with a stop loss of Rs 330, she suggested.
Mahesh M Ojha, AVP of Research and Business Development of Hensex Securities echoed similar views and suggested that investors should book 50-60 per cent profits, while the remaining portion can be held from a long term perspective.
Incorporated in September 2015, Mohali-based Quadrant Future Tek develops next-generation train control and signaling systems for the 'KAVACH' project of Indian railways, enhancing safety and reliability for passengers. It also has a specialty cable manufacturing facility with an Electron Beam Irradiation Centre.
Quadrant Future Tek has attracted Significant investor interest, said Abhishek Pandya, Research Analyst at StoxBox. "We recommend that investors who have been allotted shares consider holding their positions from a medium to long-term perspective," it said.