Listing
Zetwerk's stock market debut fades within hours of opening
The Bengaluru manufacturing company opened 5 percent above its ₹151 IPO price on Friday and closed 8.4 percent below it on the BSE.
Shares of Zetwerk Manufacturing Businesses opened at ₹159 on both the BSE and the NSE on Friday, 23 October, against an issue price of ₹151, Moneycontrol reported. Reuters, in a report carried by BusinessLine, put the NSE opening at ₹159.25.
The premium did not last. The stock closed at ₹138.30 on the BSE, 8.4 percent below the issue price, valuing the company at about ₹23,432 crore, The Economic Times reported.
Reuters reported that the shares fell as investors worried about the company’s lack of profits and its reliance on third-party suppliers. Zetwerk reported revenue from operations of ₹4,118 crore for the April–June quarter, with a loss of about ₹64 crore, according to Reuters. Its clients include Siemens Gamesa, Acer India, NTPC Renewable Energy and the Indian Air Force.
The ₹5,012 crore offer comprised a fresh issue of ₹2,830 crore and an offer for sale by existing shareholders valued at about ₹2,182 crore. It was open from 15 to 19 October and was subscribed 3.1 times overall. Qualified institutional buyers bid for 4.73 times the shares reserved for them and non-institutional investors 1.40 times. Retail investors bid for 73 percent of their portion. Moneycontrol said the proceeds will fund debt repayment and acquisitions.
Before the offer opened, Zetwerk raised ₹2,251 crore from anchor investors. Moneycontrol named BlackRock, Goldman Sachs, Nomura, Capital Group and First Sentier Investors among them, along with Norway’s Government Pension Fund Global and the Abu Dhabi Investment Authority.
The listing is also an exit for the company’s early venture backers. Kae Capital, Accel, Peak XV Partners and Lightspeed Venture Partners, with Kae’s affiliate Kalysta Capital, are set to realise about ₹1,215 crore by selling part of their holdings, according to Moneycontrol and The Economic Times. Moneycontrol reported that Zetwerk is the 30th Peak XV portfolio company to go public.
The prices above reflect a single trading session. This report is not a recommendation to buy, sell or hold the stock.
Sources
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