Aster DM has muted listing

Aster DM Healthcare had a muted listing on the BSE today morning. As against the IPO price of Rs.190, it got listed at Rs.182.1, a discount of over 4%.

The issue has just about managed to get the issue subscribed on the last day, getting oversubscribed 1.3 times.  It was mainly subscribed by qualified institutional investors has subscribed 2.09 times, non-institutional category 0.55 times and retail investors was at 1.2 times.

In our IPO Analysis we had said, “While retail pharmacy business of Aster DM has shown improvement in financial performance, hospitals have been a drag in the immediate past and quick turnaround is nowhere in sight. Operating losses, high leverage, long gestating period for new business are some of the drawbacks of the issue. Unattractive pricing doesn’t help either. Hence, considering weak fundamentals coupled with uncertain secondary market conditions, it will be prudent to given this IPO a miss.”