JG Chemicals made stock market debut with over 5% discount
Mar 13, 2024
New Delhi [India], March 13 : The shares of JG Chemicals made a disappointing debut on the stock exchanges on Wednesday as it listed with an over 5 per cent discount over its issue price.
The shares were listed at Rs 209 as against its issue price of Rs 221.
The Rs 251.19 crore initial public offering (IPO) was subscribed 27.78 times on its third and final day. Bids were led by institutional investors (32.09 times), retail investors (17.44 times), and non-institutional investors (46.33 times).
An initial public offering (IPO) refers to the process of offering shares of a private corporation to the public.
"This (listing) translates to a loss of 5.43 per cent compared to its issue price of Rs 221. The listing performance fell significantly short of pre-listing expectations, which anticipated a moderate gain of around 10 per cent," said Shivani Nyati, Head of Wealth at Swastika Investmart Ltd.
"The zinc oxide industry's competitive nature might have dampened investor enthusiasm. The company's heavy reliance on the rubber and tire industry, which can be cyclical, could be a concern for investors," Shivani Nyati added.
She added that the negative listing raises concerns about investor confidence in JG Chemicals' future prospects.
She advised the investors who participated in the IPO should closely monitor the company's performance and the overall market conditions. Investors with a long-term view may hold their position by maintaining a stop loss at 190, she noted.
