Ethos shares drop over 11% on debut; what should short-term, long-term investors do? Anil Singhvi, expert lay out strategy

Ethos IPO listing: Shares of Ethos Ltd declined over 11 per cent to Rs 774 apiece against issue price of Rs 878 in Monday's intraday trade after the Luxury watch retailer made a tepid debut on the bourses. At 11.45am, the shares were trading at Rs 774, a decline of over 5 per cent on listing price and over 11 per cent on the issue price.  

Ethos shares were listed at Rs 830 apiece on the BSE, a discount of Rs 48 or 5.47% at the upper end of the price band. On the NSE, shares were listed at a six per cent discount to Rs 825 per share, below Rs 53 or 6.04% on the issue price.  

As the premium watch maker stock further slid after tepid listing, experts were of the view that only long-term investors with an appetite to take risk should stay invested and short-term investors should trade with stoploss in this counter. They believe expensive valuations affected the listing of Ethos shares.  

Shri Pranav Saboo, CEO, Ethos Limited along with Shri @ashishchauhan, MD&CEO, @BSEIndia and others ringing the opening bell to mark the Listing of Ethos Limited on 30th May, 2022 at #BSE @ethoswatches pic.twitter.com/8aN4dtxW1N

— BSE India (@BSEIndia) May 30, 2022

Zee Business Managing Editor Anil Singhvi had said only risk-taking long-term investor should stay invested in this share. As far as short-term investors are concerned, Singhvi said they should put stoploss slightly below the issue price at Rs 850 per share in case the counter sees a massive correction. He said expensive valuation is the major reason that he has suggested general investors to avoid the issue. 

#EthosLimitedListing

आज होगी Ethos लिमिटेड की लिस्टिंग; इश्यू प्राइस ₹878/शेयर

कैसी होगी लिस्टिंग-डिस्काउंट या प्रीमियम पर?

लिस्टिंग के बाद लॉन्ग टर्म इन्वेस्टर्स क्या करें?

जानिए Ethos लिमिटेड की लिस्टिंग पर अनिल सिंघवी की राय...#StockMarket @AnilSinghvi_ pic.twitter.com/y5ZIjmKhwf

— Zee Business (@ZeeBusiness) May 30, 2022

Santosh Meena, Head of Research, Swastika Investmart Ltd. on Ethos IPO, said company’s negative listing can be attributed to the rich pricing, current market sentiments, and lack of investor interest.  

The company is one of the largest sellers of luxury watches in India having a loyal customer base, omnichannel distribution network, long-standing relationships with the best luxury watchmakers and experienced promoters, said Meena.  

"However, the high valuations, lack of exclusive agreements with watchmakers, inventory heavy operations make this issue suitable only for long-term investors having a high-risk appetite. Those who applied for listing gains can maintain a stop loss of Rs. 800," the expert added.  

Earlier, Anil Singhvi had predicted similar listing and said the issue will see a flat listing around its upper price band of Rs 878.