Shares of Hindustan Aeronautics Ltd (HAL) fell more than 5 per cent in their market debut on Wednesday after the state-run military aircraft maker's Rs 4,113 crore ($633.35 million) initial public offering last week.

HAL, which was fully owned by the government before the IPO, saw a tepid response for its offering that was subscribed 99 per cent.

Brokerage ICICI Securities, a unit of India's third-biggest lender ICICI Bank, scaled back the size of its IPO on Monday and raised a lower-than-targeted $540 million.

India's IPO market saw a record $11 billion of fund-raising last year. Companies are in the process of raising a combined more than $2 billion in IPOs in March, but the recent weak response is being seen as a setback.

“Due to the weak market conditions and the line-up of defence IPOs, this offering has not done so well. But we were bullish on the stock and even at current prices would recommend a buy from a long-term perspective,” said Tarang Bhanushali, Assistant Vice-President, Research at IIFL.

The government is yet to decide on the public offers of Pawan Hans and Airport Authority of India (AAI) which have remained in the pipeline for long.

At 0630 GMT, shares in HAL were down 3.86 per cent at Rs 1,168.15 after dropping to a low of Rs 1,150 in initial trade.The NSE share index has dropped around 8 per cent from its record highs touched in late January.

 

Related Topics
comment COMMENT NOW