Sona Comstar extends listing gains; stock skyrockets 20% to hit upper circuit

Sona Comstar shares made their inventory market debut immediately.

Sona BLW Precision Forgings (Sona Comstar) shares surged as a lot as 24% over the IPO value after an hour of commerce on itemizing day. The share value of Sona Comstar opened for buying and selling at Rs 302 apiece, up 3.92% or Rs 11.4 premium over the IPO value of Rs 291 per share. Quickly the inventory was seen surging 24% greater than the Problem value, quoting a value of Rs 362.85 per share. Sona Comstar entered the market earlier this month to lift Rs 5,550 crore by a mixture of contemporary issuance of fairness shares and provide on the market by current shareholders. The corporate is a diversified producer of automotive parts and programs with capabilities throughout drivetrain elements and motor electronics. On itemizing the inventory had a market capitalization of greater than Rs 17,000 crore. 

From Sona Comstar’s Rs 5,550 crore, greater than 94% was a suggestion on the market by current shareholder, together with Singapore VII Topco, a subsidiary of personal fairness agency Blackstone. Submit situation, promoter shareholding will drop t0 67.3% from 100% whereas public shareholding will improve from zero to 32.7%. Sona BLW’s IPO was subscribed 2.28 instances by buyers. Certified institutional consumers (QIB) bid for situation 3.46 instances whereas retail buyers subscribed 1.58 instances the portion reserved for them. Non-institutional buyers (NII) failed to completely subscribe to the quota reserved for them. 

Soan Comstar is a key participant within the rising international electrical car market. “Sona Comstar stands other than a lot of the remainder of the auto part universe by offering a powerful play on the upcoming mega alternative of electrification. As of FY21, the corporate obtained ~40% of revenues from ‘electrified’ platforms, together with ~14% from pure battery EVs (BEV),” brokerage and analysis agency ICICI Direct mentioned in a pre-IPO notice. 

Brokerage agency Motilal Oswal has a optimistic long run view on the inventory. “We like SBPFL given its presence within the fast-growing international EV market, diversified portfolio throughout classes and sturdy financials,” they mentioned earlier in a notice. “Although the valuation seems absolutely priced in, given its thrust in fast-evolving EV house each in India and globally, the market want to give premium to such rising development story,” they added. The manufacturing of battery electrical autos throughout the globe is predicted to develop at 36% CAGR between 2020 and 2025, aiding the optimistic view voiced by analysts.

The corporate will be part of friends reminiscent of Motherson Sumi Systems, Bosch, Bharat Forge, Varroc Engineering, and Minda Industries amongst others on the bourses.