MUMBAI: Shares of specialty chemicals maker Aether Industries were up 21% on their IPO price at ₹776.75 on Friday trading day.
The company made its market debut earlier in the day at ₹706.15, a 10% premium to its IPO price of ₹642.
The stock’s closing level is also its circuit high limit for the day.
Analysts said the market’s recent rebound and the company’s strong growth prospects led investors to take a positive view of the stock in a market where recent listings have either been muted or discounted.
Aether Industries raised £8.08million through its initial offering last month. The offering ran between May 24 and 26 and the company sold its shares in a price range of ₹610 to ₹642 per share. The IPO was subscribed 6.26 times due to strong response from institutional buyers, whose share was subscribed 17.6 times. HNI and retail shares were subscribed 2.52 and 1.14 times, respectively, while the employee share was subscribed 1.06 times.
In the run-up to the IPO, broker Anand Rathi had recommended subscribing to the IPO with a long-term perspective. The brokerage said the valuation of 72.3 times on an annualized basis of FY22 earnings appears fair.
“Aether is known to have a strong market position in complex intermediates where global competition is intense,” said Rathi.
“Aether is expected to continue to maintain its leadership position in some of its products due to continued focus on research and development, post-expansion plans for enhanced capabilities, synergistic business models, differentiated product portfolios of market-leading products and long-standing relationships with a diversified customer base,” said Rathi.
Meanwhile, Choice Broking had recommended “subscribing with caution” to the IPO.
“Given its dominant position in select specialty chemicals and growth prospects in end-use applications, we believe the company has good prospects. However, an overvalued valuation is worrying,” said Choice Broking.
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