After positive IPO listing, SFC Environmental Tech shares jump 12% | More steam left or book profits? Experts weigh in
SFC Environmental Technologies share price skyrocketed 12% in Wednesday's trading session after making positive debut in the Indian stock market on Tuesday.
The stock opened at ₹448.80 per share on NSE today, as compared to previous close of ₹426.10 on Tuesday and touched an intraday high of ₹478.40 on 4 November.
SFC Environmental Technologies IPO listing
SFC Environmental Technologies shares debuted on the stock exchanges on November 3 at a premium of around 8% over their IPO issue price of ₹330 per share, delivering a positive listing for investors.
Following the market debut, the company's market capitalisation stood at approximately ₹3,468.16 crore.
The listing performance was largely in line with grey market trends. According to Investorgain, SFC Environmental Technologies shares were trading at a grey market premium (GMP) of nearly 5% ahead of their stock market listing on November 3.
The company's IPO witnessed strong investor demand during the three-day subscription period. By the close of bidding on October 29, investors had placed bids for 13,41,12,240 shares against the 1,41,59,744 shares on offer, according to NSE data.
Qualified institutional buyers (QIBs) drove the subscription activity, booking their reserved portion 18.81 times. The non-institutional investor (NII) category was subscribed 12.81 times, while the retail investor segment also recorded healthy demand.
SFC Environmental Technologies intends to utilise ₹42.23 crore of the fresh issue proceeds towards the repayment or prepayment of certain borrowings availed by the company and its wholly owned subsidiary, Vasudha Waste Treatment Private Limited.
Additionally, ₹74.92 crore has been allocated to meet working capital requirements, while the balance proceeds will be deployed for general corporate purposes.
Should you buy, sell or hold?
Ravi Singh, Chief Research Officer at Master Capital Services, believes that in the short run, it would be interesting to see how efficiently the company can convert their order book into revenue.
“The stock could draw more attention if it delivers consistent execution, improves cash flows, reduces dependence on government tenders and builds on its recent entry into compressed biogas projects,” Singh said.
Mahesh M. Ojha, Vice President, Research & Business Development at Kantilal Chhaganlal Securities, advised investors who received an allotment to hold their shares if they have a long-term investment horizon.
Ojha further suggested that fresh investors wait for the stock to stabilise after listing and assess the company's execution capabilities before taking an investment decision.