IRFC Makes Lackluster Debut on Exchanges

  • Stock Market News
IRFC Makes Lackluster Debut on Exchanges
Credit: © Reuters.

By Aditya Raghunath -- IRFC ( Indian Railway Finance Corp (NS: INID )) made a lacklustre debut on the stock exchanges today. It listed at Rs 24.9, a 4% discount to its subscription price of Rs 26. The stock is currently trading at Rs 25.15.

The writing was seemingly on the wall as the grey market premium (GMP) for IRFC kept reducing as the listing day drew closer. When the issue was announced, the GMP was Rs 1.5. One day before the listing, it had fallen to Rs 0.2. On January 20, had written about the grey market premium comparison between IRFC and Indigo Paints, and the verdict was clear. IRFC was the loser.

The major reason for the fall in GMP and the quiet listing is the uncertainty in global markets, rising COVID-19 cases in the West, and the upcoming Union Budget. GMPs of other IPOs like Stove Kraft and HFFC (Home First Finance Company) also took a hit.

However, IRFC listed before the Budget while Stove Kraft Ltd (NS: STOVEKRAFT ) and Home First Finance India Co Ltd (BO: HOME ) will list after the budget. So, there is still a chance that those stocks might list at a premium to their subscription price.

Analysts and brokerage firms had repeatedly said that IRFC is a share for the long term investor and is not your typical IPO play for listing gains.

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