Shares of India are set for a muted, or mostly flat, debut at the stock market on Thursday amid the volatility sentiments of the broader markets. The recent selloff at the Dalal Street and lacklustre bidding are denting the listing prospects for the company, which is also signaled by the grey market premium (GMP) over the last few days.
Last heard, shares of Ceigall India were commanding a premium of Rs 17-18 apiece ahead of their debut, suggesting a listing pop of roughly around 5 per cent for the investors, hinting at a soft landing at the bourses. However, it was around Rs 70 when the issue opened for bidding and at Rs 11 per share when the issue closed for bidding.
Ceigall India had garnered a decent subscription from the investors but the GMP indicates a more subdued market sentiment compared to initial expectations, said Shivani Nyati, Head of Wealth at Swastika Investmart. The company's focus on specialized infrastructure projects and efficient execution model are positives, she said.
"The IPO's valuation at a P/E of 20.7 times appears reasonable but not overly attractive given the current market conditions. Overall, while Ceigall India has growth potential, the moderate investor response and existing challenges suggest a potential for a decent, rather than spectacular, listing," Nyati added.
The IPO of Ceigall India ran between August 1 and August 5. The infra company had offered its shares in the fixed price band of Rs 380-401 per share with a lot size of 37 shares. The company raised a total of Rs 1,252.66 crore from its IPO, which was entirely a fresh share sale of up to Rs 684.25 crore and an offer-for-sale (OFS) up to 1,41,74,840 shares.
The issue was overall subscribed a total of 13.78 times, led by the push from qualified institutional bidders (QIBs), whose quota was booked 31.50 times. The quota for non-institutional investors was subscribed 12.42 times. The portions reserved for employees and retail investors were booked 11.55 times and 3.77 times during the three-day bidding process.
Ceigall India received a very decent subscription demand, said Prashanth Tapse, Senior VP (Research) at Mehta Equities. "Considering the market mood and the subscription figures, we believe Ceigall India would witness a very decent listing gain in the range of 5-10 per cent on the issue price," he said.
"We continue to believe and hold our long term positive outlook on Ceigall India business model with high focus on infra theme and it could deliver impressive revenue growth. Investors shall 'hold' the Ceigall India shares for a long term perspective. The market can give Ceigall India a premium multiple towards its strong focus on project executions post listing," Tapse added.
Ludhiana-based Ceigall India, incorporated in 2002, is an infrastructure construction company with expertise in specialized structural projects, including elevated roads, flyovers, bridges, railway overpasses, tunnels, highways, expressways, and runways. The company completed over 34 road and highway projects as of July 2024.
Brokerage firms were mostly positive on the issue suggesting investors to subscribe to it. ICICI Securities, IIFL Securities and JM Financial were the book running lead managers of the Ceigall India IPO, while Link Intime India was the registrar for the issue. Shares of the company are set to debut on both BSE and NSE.