Mumbai: Newspaper publisher DB Corp. Ltd made its stock market trading debut at a 19% premium on Wednesday, listing at Rs250 a share, as media stocks benefit from renewed investor interest. The stock closed at Rs265.90, a 25% gain over the issue price.
In comparison, the broader market ended flat with the Bombay Stock Exchange’s benchmark Sensex closing 0.08% up at 17,701.13.
DB Corp., which publishes newspapers such as the Dainik Bhaskar and the Daily News and Analysis, bettered the 15% premium on listing that had been expected by analysts such as Anand Shah of Angel Broking Pvt. Ltd.
Investor interest in media companies has clearly increased, said Shah. Media companies such as Hathway Cable and Datacom Pvt. Ltd, Eros International Media Ltd and DQ Entertainment Plc. are also planning initial public offerings (IPO). Jagran Prakashan Ltd has gained 88.89% in the last six months and HT Media Ltd gained 63%.
In comparison, the Sensex has gained 26% in the past six months.
HT Media publishes the Hindustan Times, Mint and the Hindi-language Hindustan newspapers.
DB Corp.’s listing gain shows a sense of resurgence in the market, said Nikhil Vora, managing director of financial services firm IDFC-SSKI Securities Ltd. The IPO has demonstrated that a fair valuation gets an appropriate response from investors, he said.
“I suspect this could encourage other media brands to also launch IPOs...,” he said, citing the example of DQ Entertainment.
DB Corp. publishes seven newspapers, 48 newspaper editions and 128 sub-editions in three languages (Hindi, Gujarati and English) across 11 states.
Bhopal, India-based DB Corp. raised Rs270 crore selling 18.2 million shares last month. The company plans to use the proceeds to consolidate and strengthen existing markets and tap new markets for expansion.
“We are also going to utilize what we’ve raised in brand building and in liquidating some of our debts,” said Girish Agarwal, director of the Bhaskar Group.
Bloomberg contributed to this story.