Shares of leading high-end computing solutions (HCS) provider Netweb Technologies made a steller debut on Thursday (July 27) with its shares listing at Rs 947 apiece on NSE, a bumper premium of 89.40 percent. The stock debuted at Rs 942.50 per share on the BSE, a premium of 88.5 percent over its IPO offer price of Rs 500.

Share Market Live

NSE

A day ahead of the listing, the stock was commanding a premium of Rs 394 in the unlisted market, according to market analysts. Considering the upper price band of Rs 500, the shares were expected to list at a premium of nearly 80 percent.

Generally, investors look at grey market premiums to know the possible listing price.

'Investors can hold with a SL at Rs 850'

"The market witnessed another strong listing with Netweb Technologies IPO. The stock listed on the stock exchanges today at Rs 947 per share, a premium of around 89 percent over the upper end of the price band of Rs 500. The strong listing was in line with expectations, as the company has a strong track record of growth and its financial performance has been improving in recent years," said Anubhuti Mishra, Equity Research Analyst at Swastika Investmart Ltd.

"Netweb Technologies is well-positioned to benefit from the growth of the high-end computing market in India, as it has a strong focus on the niche business segment of high-end computing solutions," Mishra said, suggesting investors to hold with a stop loss at around Rs 850.

"However, aggressive investors can still choose to buy during any subsequent dip," the analyst said.

Based on the current momentum, there is anticipation of a significant premium of more than 70 percent at the time of listing, indicating a potentially remarkable debut, said Abhay Doshi, Co-founder at UnlistedArena.

The Rs 631-crore IPO of Netweb was subscribed 90.36 times at close. The primary stake sale of Netweb Technologies, which was sold in the range of Rs 475-500 apiece, between July 17-19.

The qualified institutional buyer category was the most subscribed with a subscription of 228.91 times, followed by non-institutional investors with 81.81 times. The retail portion was subscribed 19.15 times.

The issue consisted of fresh equity of Rs 206 crore and an offer for sale (OFS) of 8.5 million equity shares. Ahead of the IPO, the company had raised Rs 189 crore from anchor investors.

Netweb is one of the few OEMs in India, which is a recipient of production linked incentives schemes for IT Hardware and telecom and networking products manufacturing in India.

Between March last year and May this year, the firm almost doubled its order book value from Rs 48.5 crore to Rs 90.2 crore.

For FY23, Netweb's revenue from operations rose by 80 percent to Rs 445 crore, on the back of an increase in the sales of private cloud and HCI, supercomputing systems. Net profit for the period more than doubled year-on-year to nearly Rs 47 crore.

Equirus Capital and IIFL Securities are the book-running lead managers and Link Intime India is the registrar to the issue.

First Published:Jul 27, 2023 10:06 AM IST