HP Adhesives smart debut

HP Adhesives is a new listing today and it made a smart one too. As against the IPO price of Rs.274, the stock got listed on the BSE at Rs.319, going to Rs.334.95, which is its 5% UC.

The IPO had received a good response; it was subscribed 20.96 times, with retail investors driving the demand – their portion was subscribed 81.24 times. HNIs was at 19.04 times and QIBs at 1.82 times.

In our IPO Analysis, we had said, “Listing in T2T (BE) group (i.e. sale only against delivery of share) restricts intra-day trades and volumes. Moreover, 75% issue reserved for institutional category may lead to shares getting cornered and hence prone to volatility, post listing.  Despite planned growth, frail fundamentals on small size of operations and slim margins do not support the high pricing. Hence, avoid the IPO.”