Shining bright: These 12 IPOs have maintained high premiums from their listings since last Diwali

After Diwali 2023, around 12 initial public offerings (IPOs) have consistently commanded higher premiums than their listing gains, with each exceeding 100%. leading this group Indian Renewable Energy Development Agency Limited (IREDA)After Motisons Jewelers Ltd., Domes Industries Ltd., among others.

After Diwali 2023, there have been around 90 IPOs on the mainboard, of which around 65 have been listed at a premium, while the remaining 25 have launched at a discount. Of the IPOs listed with premium, 15 have become multibaggers, which have brought significant benefits to their investors. Mohit Gulati, CIO and Managing Partner, ITI Growth Opportunities Fund, highlighted that the growing investor enthusiasm is evident, with many IPOs being oversubscribed and some achieving multi-bagger returns in their debut. Due to this, the market capitalization of listed companies in India has increased to approximately $4 trillion, leaving Hong Kong behind.

Arun Kejriwal, Founder, Kejriwal Research & Investment Services, emphasized that although these stocks are currently valued higher than their initial listing, it is also important to evaluate them relative to their 52-week high and low levels. Since last Diwali, we have seen impressive performance, yet not many stocks are close to their 52-week highs as all of them have seen a correction.

IREDA, which is currently priced at 210, has lost a significant amount of its previous gains. A notable example of this is Tata Technology, which reached its peak 1,400 but now it is worth compared to that highest of 1,006, with a minimum of 970. Therefore, the stock is currently Up 36 or 4% from its 52-week low. Most of the initial listing gains have been eroded; However, the absolute figure remains double what it was at the stock peak. 1,400, which was 2.8 times its original price, is now trading at 2 times and just above its low.

Let us examine the performance of some of the top ones in detail.

India’s IPO market since last year

According to Mohit Gulati, 2024 has been a remarkable year for India’s IPO market, with over 260 companies raising over $9 billion, more than double the amount in the same period last year. This surge has established India as a global IPO leader.

The EY India report shows that both the mainstream and SME markets witnessed excellent growth in Q3 2024. The main market achieved 27 IPOs, representing a 29% increase from 21 IPOs in Q3 2023, while generating US$4,285 million – a 142% increase from US$1,770 million during the same period last year. That’s impressive growth. The SME sector continued its strong performance with 84 IPOs, raising US$398 million.

A supportive macroeconomic environment has fostered positive conditions for IPO activity, with interest rates expected to decline to 6.2% and inflation to decline to 4.5% by 2025. The strong performance of mid- and small-cap stocks in the secondary market has prompted more unlisted companies to consider going public, as 68 companies have listed in their draft red in the third quarter of 2024, according to SEBI data. Certified by submission of Herring Prospectus (DRHP).

“With 66 companies having applied for listing and strong interest from both domestic and multinational firms, India’s IPO momentum is expected to continue throughout 2024 and 2025. The moral of the story is simple- if there is value left on the table; Investors will be rewarded by their interest and subscription numbers, Gulati said.

technical scene

IREDA

Rajesh Bhosale, equity technical and derivatives analyst at Angel One, said the stock was trading flat, though it has surged more than 9% this week. This bounce is seen from the critical support of 200sma. Although the bearishness is still not very encouraging, one can expect this bounce to extend to 230 in the near term and 200 will continue to act as support.

Motisons Jewelers

Kapil Shah, technical analyst at Emkay Global and technical analysis instructor at FinLearn Academy, pointed out that the stock has performed consistently on an uptrend since its initial listing. In the last 30 trading sessions, it has fluctuated between 265 and 325. The current trend appears to be sideways from positive. Potential support levels have been identified at 265 and 245. A movement above 325 would indicate a bullish breakout.

Domes Industries

Over the past ten months, DOMS Industries has not displayed any bearish candles on the monthly charts, indicating a prevailing bullish trend. The stock exhibits strong support at 2,470 levels. Subsequent corrections may provide favorable buying opportunities. Furthermore, a breakout above 2900 levels will further strengthen the bullish outlook, Kapil Shah said.

Disclaimer: The above views and recommendations are those of individual analysts, experts and broking companies, and not of Mint. We recommend investors to check with certified experts before taking any investment decision.