Fund manager cites Page Industries’ listing as a lesson for IPO investors
- The IPO market is going to be one of the most interesting ones to watch in 2023, said Edelweiss' Radhika Gupta
The initial public offer (IPO) market is going to be one of the most interesting ones to watch in 2023, as per well-known fund manager Radhika Gupta, who is the managing director and chief executive officer of Edelweiss Asset Management Company, as she believes good companies think of an IPO as just an event in their life cycle, and not an end game.
“The IPO market is going to be one of the most interesting ones to watch in 2023. Do we learn the tough lessons of 2021 and 2022, or still continue to dance with the devil, this time in pale moonlight?,” Gupta said in a series of tweets.
Meltdown in new debutants and volatility triggered by geopolitical tensions soured the sentiments for the primary markets as Investors remained jittery throughout 2022 on recessionary fears and rising interest rates amid soaring inflation as fund mobilisation from share sales in 2022 was way lower amid weak listings.
Citing Page Industries' stock market debut as an example, she added, “Case in point and my favourite: Page Industries which had a disastrous listing and debut in 2007 but went on to become a real wealth creator. And it listed poorly in a bull market when IPOs particularly in the infra space we’re very hot.”
Page Industries is involved in manufacturing and retailing innerwear, and has the exclusive licensee of Jockey International in India, Sri Lanka, Bangladesh, Nepal, Oman, Qatar, Maldives, Bhutan, and the UAE. It is also the exclusive licensee of Speedo International Ltd for the manufacture, marketing and distribution of the Speedo brand in India.
The multibagger stock has rallied more than 15300% in 15 years since its listing in March 2007 when it was trading around ₹270 per share level to currently hovering above ₹42,000 level. Page Industries shares are up about 2% in a year's period.
“I do believe good companies think of an IPO as just an event in their life cycle, and not an end game. They leave value on the table, drive earnings growth, and reap very long term rewards that are not the result of financial jugglery,” Gupta said.
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