Both these IPOs, which received good investor response last week, have seen muted debuts as the bumper Bajaj Housing listing hogged all the attention.
Kross, a leading player in the organized trailer axle manufacturing industry, made a subdued debut at the bourses, listing at Rs 240 per share, on par with its issue price. Meanwhile, Tolins Tyres made a mere 0.44% gain over the issue price.
Despite the subpar listings, analysts are bullish on the long-term prospects of Kross Ltd and Tolins Tyres.
“While Kross boasts strong fundamentals like backward integration, long-term client relationships, and consistent financial growth, the industry’s relatively high valuation and potential challenges might have tempered investor enthusiasm,” said Shivani Nyati, Head of Wealth at Swastika Investmart.
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“Investors who participated in the IPO may consider holding their shares while closely monitoring the company’s performance and market conditions and keeping a stop loss at the issue price,” Nyati added.
The IPO of Kross was subscribed nearly 17 times at close, driven by a strong response from non-institutional and institutional investors.
Tolins Tyres, on the other hand, was subscribed 25 times, indicating a decent degree of investor interest.
Analysts said the company’s product diversity, widespread customer base, and consistent financial performance offer a positive outlook for the long term.
“However, investors should remain cautious about the competitive landscape within the tyre industry and the potential challenges associated with being a smaller player. Those who want to hold it long-term may keep a stop-loss issue price,” said Shivani Nyati.
While Kross will use the IPO proceeds to repay debt and fund future growth, Tolins will use the funds to augment long-term working capital requirements, for repayment of debt and investment in the company’s subsidiary.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)
