Nuvoco Vistas Expected to Have Weak Listing Today

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Nuvoco Vistas Expected to Have Weak Listing Today

By Aditya Raghunath -- Nuvoco Vistas Corporation Ltd (NS: NUVO ), India’s fifth-largest cement maker is scheduled to list on exchanges today, and it is expected to have a weak listing.

The biggest factor working against Nuvoco is that retail interest has been waning in the IPO segment. What was a red-hot trend just a couple of months back has completely lost momentum now.

The IPO was subscribed to only 73% by retail investors and 66% by non-institutional investors. It was qualified institutional buyers who subscribed 4.23 times.

Last week, with the exception of Devyani International Ltd (NS: DEVY ) which listed at 56% premium to its issue price, other debutants like Windlas Biotech Ltd (NS: WINL ) (down 11.7%), Krsnaa Diagnostics Ltd (NS: KRSN ) (up 2.5%) and Exxaro Tiles Ltd (NS: EXXA ) (up 10%) saw muted listings. Cartrade Tech Ltd (NS: CART ) also debuted at a loss of almost 8%.

Prashanth Tapse, VP Research at Mehta Equities told news portal Moneycontrol, “New investors will always remain concerned when it comes to applying in IPO which has a large portion of an offer for sale, as a result, we can see muted subscription figures. The muted listing seems to be justified high debt on books and inconsistent financial performance in last 3 years.”

Nuvoco’s cement production capacity is around 4.2% of India’s total cement capacity. Even though the outlook for the cement sector is strong, the outlook for the stock is not.



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