The share prices of Sona BLW Precision Forgings or Sona Comstar hit the upper circuit of 20% in trading on Thursday, after getting listed on the share market at a 3.9% premium over its issue price of Rs 291 during the IPO.
As of 2:03 PM, the auto ancillary company’s stock stood at Rs 361.20 on the NSE, gaining 24.12% over the course of the day. The sharp increase is attributed to the heavy investor demand coming after the company’s IPO received a muted response. The manufacturing firm made its debut on the market today by opening at the price of Rs 302.4, providing a 3.9% listing gain to investors.
Around 47.5 lakh shares of the company exchanged hands on the BSE while 4.14 crore of its equity shares were traded on the NSE.
Sona Comstar went public last week, issuing an IPO of Rs 5,550 crore comprising a fresh issue of shares of Rs 300 crore and an offer for sale worth Rs 5,250 crore. The public offer was subscribed 2.28 times between June 14 and June 16. The higher proportion of OFS, being sold by shareholder Singapore Topco, spooked the investors leading to a less than expected subscription rate.
The company, which manufactures auto components, has announced that it will use the proceeds from the IPO to repay its debt worth Rs 241.12 crore. Following the public listing of Sona Comstar, the stake of the company’s promoters- Sona Autocomp and Singapore Topco, has decreased to 67.3%.