AGS Transact Tech shares correct 5% after flat debut; what should investors do with this counter?

AGS Transact Tech shares listing: Shares of AGS Transact Technologies made a flat entry on the National Stock Exchange (NSE) and the BSE. Against issue price of Rs 175 at the upper price band, shares of omni-channel payment solution were listed at Rs 176 per share on the BSE and Rs 175 apiece on the NSE.  

At 11 am, shares of AGS Transact Tech shares were trading with loss of Rs 6.35 or 3.61% against listing price and Rs 5.35 or 3.06% on the issue price to Rs 169.65 on the BSE. Shares touched day's high of Rs 181.85 per share and corrected over 5 per cent to 52-week low of Rs 166.25 apiece on its debut day on the BSE.  

As shares debuted in line with market experts' expectations and have corrected more than 5 per cent on its listing price, here is what analysts suggest investors should do with this counter.  

What should investor do? 

The company is one of India's leading Omni-channel payment solution providers with a strong network. However, the government's focus on digital payments will further decrease the use and availability of cash can have an adverse effect on business activities," said Santosh Meena, Head of Research, Swastika Investmart Ltd. "The investors who got the allotment are advised to book the profit and look for other investment opportunities," said the expert.   

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Gaurav Garg, Head of Research, CapitalVia Global Research Ltd, too recommended to avoid this stock. "Although the company is one of the leading players in the ATM management space with a strong pan India network, it has a threat from next-gen payment solutions providers," he said.  

The flat debut by AGS Transact Technologies Ltd were due to multiple reasons like weaker secondary market sentiments in the recent trading sessions, 100 percent OFS offer and a flat growth in topline, underlined Garg.  

"Investors who have already subscribed this issue can consider booking profit around 15 to 20 percent," he added.  

What market experts have predicted on its listing? 

Earlier, the market experts have also hinted at flat to weak opening for this IPO.  

"The GMP for AGS Transact is Rs 5. Although it was subscribed 7.79X and is an OFS we expect a muted debut on the listing. It is advised to book positions if allotted considering the current volatile markets." Manoj Dalmia, founder and director of Proficient equities Private Limited had said.  

The issue was over-priced and there is nothing available for the investor as it is completely offer-for-sale, said Ravi Singhal, Vice Chairman at GCL Securities.  "Considering high volatility and negative sentiment of the current market, I am expecting AGS Transact Technologies shares to list at somewhere around 5 per cent discount. The issue may list at around ₹165 per equity share," he had said.  

Being an integrated omni-channel payment and cash solutions provider, AGS Transact's diversified product portfolio, customer base, and revenue stream has made it a good option to subscribe for long term gains, said Ravi Singh, Vice President & Head of Research, Share India Securities 

""However, the current market scenario is not in a positive mode, which may affect the listing gains. We expect the listing may be at a discount somewhere in the range of ₹160 to 170 per equity share," Ravi Singh had said.  

Company details

The company provides customised products and services comprising ATM and Cash Recycler Machines (CRM) outsourcing, cash management and digital payment solutions including merchant solutions, transaction processing services and mobile wallets. Founded by Ravi Goyal as chairman of AGS Transact Tech, the company began its entrepreneurial journey in 1997 by starting a colour matching dispenser company.