Hemang Jani, Head Equity Strategist, Broking & Distribution, Motilal Oswal Financial Services
Two companies listed on the exchanges today with diverse listing– one saw a stellar opening while another witnessed a lacklustre opening. Shyam Metalics listed with 24.2% premium against its issue price of Rs 306 per share. On the other hand, Sona Comstar listed with just 3.9% premium against its issue price of Rs 291 per share.
Sona Comstar, despite being in a niche space of EV components, saw a little tepid listing premium due to its large issue size of Rs 5550 crore. On the other hand, Shyam Metalics witnessed good listing premium given its presence in the metal space which is in an upcycle and that too in the value-added steel products. Both the companies are present in niche space and have good business fundamentals and financials.
We like Sona Comstar given its presence in the fast-growing global EV market, diversified portfolio across categories and robust financials. Though the valuation at ~74x P/E appears fully priced in, given its thrust in fast-evolving EV space both in India and globally, the market would like to give a premium to such an emerging growth story.