Jobaaj Stories
Packaging solutions provider Sah Polymers listed on our bourses today as the stock registered a massive 37.3% listing gain.
Sah Polymers is a leader in the manufacture and export of Polypropylene and High-Density Polyethylene (HDPE) Woven Bags, BOPP Laminated Bags, and Flexible Intermediate Bulk Containers (FIBCs) in India. Moreover, the company also has a petrochemicals arm.
The 25-year-old business provides packaging solutions to businesses in a variety of industries such as Agro Pesticides Industry, Basic Drug Industry, Cement Industry, Chemical Industry, Fertilizer Industry, Food Products Industry, Textile Industry Ceramic Industry, and Steel Industry.
Before the launch of its IPO on 30th December 2022, the company raised Rs 30 crores from three anchor investors: Leading Light Fund VCC, Saint Capital Fund, and Maven India Fund as it was unable to garner the attention of any other investors.
The public issue, which had a size of only Rs 66.30 crores, saw an overwhelming response. QIBs, which had 75% of the issue, subscribed to their portions 2.4x times. However, HNIs and RIIs, which had a combined portion of 25%, subscribed to their relevant portions 32.69x & 39.78x times, taking the total subscription to 17.46x times!!
Analysts saw a premium of Rs 8-10 per share, which translated to a 12-15% GMP. As such, a flat to moderate premium debut was expected for the stock.
However, the stock listed at Rs 85 per share today morning, marking a Rs 20 premium upon listing!! Moreover, this was the lowest point the stock touched as it saw significant buying pressure throughout the day and ultimately closed at Rs 89.25 per share, up 37.3%.
After today's session, the entire investment of Rs 14,950 per lot (230 shares x Rs 65 per share) grew up to Rs 20,528 (230 shares x Rs 89.25 per share).
Analysts felt that the issue was oversubscribed heavily only because of the small issue size. Moreover, the fully priced business, low future growth prospects & pricey valuation made the stock a bad long-term hold. Some even suggest investors exit upon listing and use the funds elsewhere.
Article by Aman Agarwal.
