IndiaMART InterMESH Ltd, which operates an online business-to-business (B2B) marketplace, made a stellar debut on the stock exchanges on Thursday with its shares listing at huge premium and closed higher.
Shares of IndiaMART began trading on the BSE at Rs 1,180 apiece, up 21.27% from the initial public offering (IPO) price of Rs 973, stock-exchange data showed. The stock touched a high of Rs 1,339 during the session before closing at Rs 1,302.55.
The company’s market capitalisation stands at Rs 3,748.06 crore against a valuation of Rs 2,800 crore it sought in the IPO.
The BSE’s benchmark Sensex advanced 0.17% to close at 39,908.06. On Thursday, the government tabled the economic survey that expects the country to clock higher economic growth due to macroeconomic stability. The survey, prepared by chief economic adviser Krishnamurthy Subramanian, pegged India’s GDP estimate at 7% for the current fiscal year compared with 6.8% last year. The government will present its Budget on Friday.
IndiaMART is the eight company to list on the main board of the stock exchanges this year. Three of the previous seven companies have made strong debuts while two tanked and two others ended flat after losing initial gains.
IndiaMART’s strong debut follows an IPO that was covered a little over 36 times. The Rs 475 crore-offering was entirely a secondary market sale by promoters, venture capital investors and other shareholders. It resulted in 17% stake dilution on a post-issue basis.
Intel Corp.’s venture capital arm; Accion Frontier Inclusion Mauritius, a fund managed by venture capital firm Quona Capital; and venture capital firm Amadeus partially exited in the IPO.
IndiaMART will not get any proceeds from the share sale. The net proceeds, after deducting the issue expenses, will go to the selling shareholders.
The IPO size was earlier estimated at Rs 550-600 crore. The company was seeking an estimated valuation of Rs 4,000 crore at the time of filing its draft prospectus.
The markdown in estimated valuation reflects the market correction in the past year resulting from a liquidity crunch in the shadow banking segment and slowing economic growth.
ICICI Securities, Edelweiss Financial Services and Jefferies India managed the share sale.