Arkade Developers Shares Surge 33% on First Day: Analyzing the Post-IPO Performance
Arkade Developers made a notable debut on the Indian stock market, with shares listing at a significant premium to their IPO price. The company’s initial public offering (IPO) was priced between ₹121 and ₹128 per share, with the final issue price set at ₹128. This pricing reflects the strong demand that Arkade Developers garnered during its subscription period, which ran from September 16 to September 19, 2024.
Main Points
IPO Overview
Arkade Developers raised ₹410 crore through its IPO, which included a fresh issue of 3.2 crore shares. The IPO attracted considerable interest, being oversubscribed by more than 113 times overall. Institutional investors showed robust participation, with qualified institutional buyers subscribing 163 times and non-institutional investors subscribing 162 times. Retail investors also displayed strong interest, with a subscription rate of over 50 times.
Upon listing, Arkade Developers shares opened at ₹177 on both the National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE). This opening price represented a premium of approximately 38.28% over the issue price of ₹128. However, the shares slightly dipped during the trading day, closing around ₹165.85 by the end of market hours on September 24, reflecting a 33% increase over the issue price.
| Exchange | Listing Price | Issue Price | Percentage Increase |
|---|---|---|---|
| NSE | ₹177 | ₹128 | 38.28% |
| BSE | ₹175 | ₹128 | 36.7% |
Despite a strong start, Arkade Developers’ shares experienced a minor decline post-listing. As of September 24 afternoon trading, shares were reported to have fallen by about 4%, although they still maintained a healthy increase over the initial offer price. Analysts suggest that this fluctuation is typical for newly listed stocks as they adjust to market conditions.
Arkade Developers has demonstrated impressive financial growth leading up to its IPO. For the financial year ending March 31, 2024, the company reported a staggering 184% increase in revenue and a 142% rise in profit after tax (PAT) compared to the previous year. This growth has been attributed to successful project completions and ongoing developments in prime locations across Mumbai.
Looking ahead to tomorrow’s trading session, market analysts anticipate continued volatility as investors assess the stock’s performance post-listing. The Grey Market Premium (GMP) before listing was around ₹63, indicating expectations of a robust opening; however, actual market performance has shown some divergence from these estimates.
Investors are advised to monitor trading volumes and market sentiment closely. Some analysts suggest that holding onto shares could be beneficial for long-term investors due to Arkade’s solid fundamentals and growth potential in Mumbai’s real estate sector.
The funds raised from the IPO are earmarked for several strategic initiatives:
- Development costs for ongoing projects such as Arkade Nest and Prachi CHSL.
- Acquisition of land for future projects.
- General corporate purposes.
This strategic allocation aims to bolster Arkade’s position in the competitive real estate market in Mumbai.
Disclaimer: The information given in this article is from investment experts and brokerage companies, they do not represent Local Haryana. Before taking any investment related decision, you must consult a certified expert.
