Stock market today:
RR Kabel’s shares listed at a 14% premium over the equity share issue price of 983, trading for $1,035. On the BSE, the share price of RR Kabel opened at $1,179 per share, while it was listed on the NSE at $1,180 per share. Given that both stock market and grey market analysts had projected an 8–10% listing premium for the allottees, this listing exceeds market expectations.
After being listed at a 14% premium, the share price of RR Kabel soared even higher, hitting an intraday high of 1,198 on the NSE and 1,198.05 on the BSE. The stock, however, quickly saw profit-taking and dropped to 1,143.10 on the BSE and 1,136.80 on the NSE.
Market analysts claim that RR Kabel Limited is selling at a high valuation and that it has superior margins than its competitors as well as a higher P/E multiple than its rivals. Therefore, it is advised that shareholders of RR Kabel book listing profits and sell their shares because other stocks in the same sector are anticipated to perform better in the coming trading sessions than RR Kabel.
Share Price Perspective
Arun Kejriwal, the founder of Kejriwal Research & Services, advised RR Kabel stockholders to book listing profits since “nearly 90% of the pure income from the public issue was reserved for QIBs, meaning that 90% of the pure income will be used.” Promoters are offloading their stock. Therefore, it is anticipated that the company’s financial situation will remain strong in contrast to its competitors despite the public issue’s listing.
Prashant Tapse, Senior Vice President – Research, Mehta Equities, agreed with Arun Kejriwal’s assertions: “RR Kabel IPO was announced at a high valuation, which was visible in the present market condition. But because other competitors in the sector are anticipated to do better than RR Kabel in the upcoming sessions, shareholders of RR Kabel are recommended to book profits and depart.
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Prashant Tapse of Mehta Equities stated, “No advice is given on new investments at current levels,” in reference to those who were unsuccessful in obtaining RR Kabel shares during the allocation procedure. Instead of concentrating on RR Kabel shares, one should pay attention to other public issues or alternatives in the same industry.