Stocks

After big-bang subscription, S Chand lists quietly at 5% premium

Our Bureau Mumbai | Updated on January 11, 2018 Published on May 09, 2017

That makes it yet another tepid listing by an education firm

Education content provider S Chand & Company listed at just 5 per cent to its issue price of ₹670 on the NSE. The stock slipped below its issue price and touched a low of ₹658.2. However, it managed to close at ₹680.

The company’s initial public offer was oversubscribed a massive 59.49 times. The portion set aside for qualified institutional buyers was oversubscribed 44.27, times while that for non-institutional investors a staggering 204.65 times. The retail investor category was also oversubscribed 6.07 times.

S Chand & Company offers 53 consumer brands across knowledge products and services, including S Chand, Vikas, Madhubun, Saraswati, Destination Success and Ignitor. It is a market leader with a share of 13 per cent in education content. The company’s revenues and earnings have seen a compounded annual growth rate of 33 per cent each between FY12-16.

Peers’ poor show

Education stocks such as Educomp Solutions, MT Educare and Tree House Education and Accessories have been unable to generate long-term wealth for investors. MT Educare, listed in April 2012, is trading at just around its issue price of ₹80.

On the other hand, Educomp Solutions and Tree House have been big value destroyers since their listing in 2006 and 2011, respectively. CL Educate, listed in March 2017, had closed at a 16 per cent discount on debut and is still trading 12 per cent below the issue price.

Centrum Broking expects more pressure on the company’s stock price due to high valuation.

Published on May 09, 2017

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