Stock markets in India are presently trading marginally higher. Sectoral indices are trading on a mixed note with stocks in the IT sector and telecom sector witnessing maximum buying interest. Metal stocks are trading in the red.
The BSE Sensex is trading up 40 points (up 0.1%) and the NSE Nifty is trading up 16 points (up 0.2%). The BSE Mid Cap index is trading down by 0.1%, while the BSE Small Cap index is trading up by 0.1%. The rupee is trading at 65.08 to the US dollar.
In the news from the IPO space, HG Infra Engineering Ltd made a tepid debut on bourses today. The scrip of the company, which recently concluded its IPO subscription offer, got listed at Rs 270, same as its issue price.
HG Infra Engineering Ltd is pre-dominantly engaged in the engineering, procurement and construction (EPC) services of road projects. Currently, more than 90% of the business comes from Maharashtra and Rajasthan.
The company’s order book has grown at a phenomenal pace of 114% compounded annual growth rate (CAGR) from FY15 to FY17. With a track record of delivering projects on, the company has received bonuses for early execution of projects.
At the time of writing, HG Infra Engineering Ltd share price was trading at Rs 268.
Speaking of IPOs, the demand for IPO’s has reached sky-high levels. This euphoria is something similar to what was seen in 2007-08.
At times like this, it pays to follow a merit-based selection – primarily including valuation, business, and management quality – to go about investing in IPOs. If it means going against the herd, so be it. And going by recent past, this strategy has been proven to be successful more often than not.
Also note that with big ticket IPOs in the limelight, SMEs have also joined in to get a share of the pie. The recent SME IPO data for 2017 certainly seems to suggest so.
The amount raised by SME IPOs in 2017 stood at 17.85 billion, more than three times the amount raised in 2016. The number of SME IPOs launched also doubled from 66 to 132. This is evident from the chart below:
