Tata Tech IPO, IREDA IPO, Gandhar Oil IPO, Flair IPO, Fedfina IPO open for subscription: Which ones should you choose?
- IPO this week: Five IPO's including Tata Technologies Ltd, Flair Writing Industries Ltd, Fedbank Financial Services Ltd, Gandhar Oil Refinery India Ltd, and IREDA are open. Analysts expect Tata Technologies IPO to receive the most attention and highest subscriptions, followed by the IREDA IPO.
IPO this week: The IPO frenzy hits an all-time high with five issues opening and closing this week. All the companies entering the market belongs to different sectors. Tata Technologies Ltd, the year's most-awaited initial public offering (IPO), is on the list with Flair Writing Industries Ltd, Fedbank Financial Services Ltd, Gandhar Oil Refinery India Ltd, and Indian Renewable Energy Development Agency Ltd.
Indian Renewable Energy Development Agency IPO (IREDA IPO) seems to have set a tone for the week with overall stellar performance on day 1, where retail investors stole the show by being fully booked within two hours of subscription opening. IREDA IPO was subscribed 1.96 times on day 1. IREDA IPO's retail investors portion was subscribed 1.97 times, NII portion was subscribed 2.73 times, and Qualified Institutional Buyers (QIB) portion is booked 1.34 times. Employee portion has been subscribed 2.11 times. IREDA IPO opened for subscription yesterday (Tuesday, November 21), and will close on Thursday, November 23. The other four on the list opens for subscription today (Wednesday, November 22), and will close on Friday, November 24.
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Five IPOs in the primary market would overwhelm investors in trying to decide which one to choose. Analysts believe that Tata Technologies IPO will receive the most buzz and highest subscriptions, with the Indian Renewable Energy Development Agency IPO coming in second. Further, they anticipate that this week's opening and closing of five major market issues will have an impact on market liquidity for a week as investors seek to apply for these issues.
"The total amount to be raised would be roughly ₹7,400 crore, which is quite a bit. Individual investors would be under pressure to allocate scarce resources as a result. Each person has to allocate resources according to the likelihood of subscriptions, allocations, and ultimately profits. Put simply, allocate some of your resources towards these five issues by doing some homework," said Kris Arun Kejriwal, Founder, Kejriwal Research and Investment Services an advisory firm.
Investors will likely be debating which IPO to choose—FedFina IPO, Tata Tech IPO, IREDA IPO, Gandhar Oil Refinery India IPO, Flair Writing IPO. Here's what experts say about it:
Mohit Gulati, CIO & Managing Partner of ITI Growth Opportunities Fund
"I would certainly stay away from Fedfina IPO owing to the new Reserve Bank of India (RBI) circular increasing the risk weights on unsecured lending thereby increasing the borrowing costs and eventually compressing margins.
IREDA being a Public Sector Undertaking (PSU) will always have an overhang of further shares coming in from Government of India (GoI).
Flair would-be a pass for me. Gandhar Oil looks like a good issue and worth subscribing to. But my top pick as spoken earlier will surely be Tata Tech IPO. Particularly if you're a Tata motors share holder who gets a separate allotment quota," said Gulati.
Avinash Gorakshakar, Head Research of Profitmart Securities
According to Gorakshakar, Tata Tech IPO is a good long term opportunity for investors who want to invest over the next 2 years looking at its strong order book and excellent financials going ahead.
IREDA is also a good long term opportunity but listing gains may be limited for short term.
Kris Arun Kejriwal, Founder, Kejriwal Research and Investment Services an advisory firm
Kejriwal claims that IREDA, as its name implies, is the leading organisation for renewable energy and has provided funding for numerous projects spanning the entire value chain. Investing in the company makes sense and provides opportunities for short- and medium-term appreciation.
The second issue, from Tata Technologies Limited, is attractively priced and has room to grow over the next three to five years. At just over ₹3,000 crore, the issue is comparatively small in size. Due to the thrill surrounding the issue, many investors will be disappointed by the non-allotment. Regardless, there is a necessary investment to be made.
In Flair Writing Industries' case, the issue would perform well and present opportunities for short- to medium-term appreciation. Another well-justified investment. On the other side, Gandhar Oil Refinery (India) PE is appealing and presents opportunities for growth in the near to medium run.
"Given the risk weightage that the RBI has changed for consumer loans, Fedbank Financial Services' valuation appears a little high. This will be further highlighted as the BFSI market continues to tremble under selling pressure. Although FedFina, the NBFC that is widely recognised, is unaffected because it is not mentioned in the segment, the sentiment would be impacted. Given the choice of four other issues on similar dates and the valuations in light of the recent developments, the bank is now much more expensive, making it the least desirable option. The issue may be looked at if funds are available or may be on listing," explained Arun.
Disclaimer: The views and recommendations above are those of individual analysts, experts and broking companies, not of Mint. We advise investors to check with certified experts before making any investment decisions.
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