Yatra Online had a disappointing debut on Dalal Street as its shares were listed at a substantial discount.
Both the National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE) witnessed Yatra Online’s shares opening at lower prices than expected. The online travel company’s shares were listed at a 10.2% decrease from their issue price of Rs 142.
So, what should investors consider doing?
Shivani Nyati, Head of Wealth at Swastika Investmart Ltd, shared her insights on the market debut of Yatra Online Limited (YOL). She pointed out that the shares began trading at Rs 127.5 per share, marking a more than 10% drop from their IPO price of Rs 142.
Nyati attributed the disappointing listing of YOL’s shares to several factors, including the company’s high price-to-earnings (P/E) valuation, heavy reliance on the airline ticketing business, and the intensely competitive nature of the travel industry. She added, “All in all, YOL represents a risky investment, and investors who were allotted shares in this IPO should consider exiting their positions.”
The Yatra Online IPO featured a significant allocation of shares across various investor categories. Specifically, at least 75% of the shares were reserved for Qualified Institutional Buyers (QIBs), up to 15% for Non-Institutional Investors (NIIs), and a maximum of 10% was set aside for Retail Investors.
Yatra Online’s IPO comprised a fresh issuance of shares valued at Rs 602 crore and an offer for sale (OFS) of up to 12.2 million shares by a promoter and an existing investor.
The proceeds from the IPO are intended to support the company’s strategic investments, acquisitions, technology development, customer acquisition, and organic growth initiatives.
Key entities involved in managing the IPO included SBI Capital Markets Ltd, DAM Capital Advisors Ltd, IIFL Securities Ltd as book running lead managers, and Link Intime India Private Ltd as the offer’s registrar.
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