Didn’t get Jio IPO shares? Experts decode the listing-day playbook for investors
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Jio Platforms’ Rs 30,188-crore IPO was subscribed 22.19 times, with the final issue price set at Rs 1,119 per share. As the stock prepares to list on the NSE and BSE on October 28, investors who missed the allotment are weighing whether to buy on debut or wait for a potential correction.
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Loading...×With the allotment of Jio Platforms’ initial public offering (IPO) finalised, investors who missed out on the issue are now turning their attention to its stock market debut. As the company prepares to list on the exchanges on October 28, the key question is whether investors should buy the shares on listing or wait for a possible correction.The Rs 30,188-crore IPO, which opened for subscription on October 21 and closed on October 23, was subscribed 22.19 times overall, reflecting strong demand across investor categories, according to data from the National Stock Exchange (NSE).
Jio Platforms has fixed the final issue price at Rs 1,119 per share. The IPO comprised a fresh issue of 27 crore shares, aggregating to Rs 30,187.65 crore, with the shares scheduled to list on the NSE and BSE on October 28.
For investors who did not receive an allotment or missed applying for the issue, the listing presents an opportunity to gain exposure to Jio Platforms in the secondary market. However, market experts suggest that investors should closely monitor the stock’s listing price and subsequent movements before deciding on an entry point.
Read more: Jio IPO: Can India’s biggest-ever issue buck the trend of muted listing gains among mega IPOs?
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Should you buy Jio Platforms shares after listing?
Fundamental analyst Ambareesh Baliga said that institutional demand for the IPO was significantly higher than anticipated. However, the key question now is whether that demand will continue in the secondary market after listing.“The institutional demand in the Jio IPO was much more than what most of us would have expected. Now, the question is whether that demand is limited to the IPO or whether it will also continue during the listing. So, if that happens, then possibly Jio could move up further,” Baliga said.
While grey market indications were pointing to a premium of around 20-22%, Baliga said he expected a more modest listing premium of 8-10%, considering the size of the issue.
However, Baliga cautioned investors against chasing the stock if it opens significantly higher. For those who missed the allotment, he suggested looking for an entry closer to the IPO price if the stock fails to sustain its initial gains.
“For those who have not been allotted shares or did not apply, I would say that they should look to buy closer to the IPO price in case what I have just said does not work out. If the stock opens about 8-10% higher and starts correcting, that could be the time to buy,” he said.
Baliga also pointed to the size of the IPO and the possibility of selling pressure as investors look to book profits after listing.
“Otherwise, wait for the institutional demand to be satiated because, anyway, it was a large IPO. Even at 10%, there would be supply coming in, because a lot of people have applied only for that 10% or more,” he said.
Should investors wait for a correction?
Avinash Gorakshakar, Founder and Head of Research at Avinash Mentor Research Services, advised investors who missed the allotment to wait for the stock to stabilise after listing rather than rush to buy during the initial trading sessions.He said the stock could move up sharply immediately after listing before witnessing profit booking.
“No, they should wait. Better to buy once the price stabilises, as initially after listing the stock may move up swiftly but later on can see some profit booking,” Gorakshakar said.
His view suggests that investors who were unable to secure shares in the IPO could track the stock’s price movements in the initial sessions before deciding on an entry point. For investors who missed the IPO allotment, the decision, therefore, will hinge on the stock’s listing price and how it trades in the initial sessions.
(Ambareesh Baliga is a SEBI-registered market analyst (Regn. No. INH000001139). Neither he nor his family members hold any positions in the stocks mentioned above or have any financial interest in the companies discussed.)
(Avinash Gorakshakar is a SEBI-registered market analyst (Regn. No. INH000001071)
Disclosure: This article has been written by Kumar Gaurav, who is not a Sebi-registered Research Analyst or an Investment Adviser. Gaurav and their ‘relative(s)’ (as defined under Section 2(77) of the Companies Act, 2013) do not hold any financial interest in the companies mentioned in this article as of the date of publication. The views/recommendations mentioned in this article, wherever applicable, are those of the respective Sebi-registered Research Analyst/brokerage and have been reproduced/reported with due attribution. They should not be construed as the views or recommendations of The Economic Times Digital or the journalist. Readers are advised to consider the original research report and make their investment decisions based on their own assessment. Brokerage disclaimers here
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Figures reflect the source report and its stated period. This article is for information and is not investment advice.
