Nuvoco Vistas shares RECOVER 13% on BSE, 10% on NSE after weak listing – Do long-term investors have investment opportunity? Anil Singhvi says this - check negatives, positives

Nuvoco Vistas Corporation shares – The shares of Nuvoco Vistas Corporation were listed on Monday at a discount of 17.3 per cent on the BSE and 14.91 per cent on the NSE. The issue price of this Initial Public Offering (IPO) was Rs 570. However, the stock picked up by over 13 per cent on the BSE, while over 10 per cent recovery was seen on the NSE too at 12.20 pm.  

It is still trading down by almost Rs 35 from the issue price of Rs 570 on the BSE and NSE. Around this time, the Nuvoco Vistas Corporation shares were trading at RS 535.35 on the BSE, while at Rs 535.50 on the NSE.  

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The intraday high was Rs 550 on the NSE and BSE. 

Zee Business Managing Editor Anil Singhvi called this a weak listing. The Market Guru had earlier said that the long-term investors will have an opportunity to buy this stock if the stock is listed at a discount of 10-20 per cent from the issue price.     

The IPO of Nuvoco Vistas Corporation had ended on 11 August. This public issue was overall subscribed 1.71 times on the NSE. The Retail Individual Investors (RIIs) subscribed the issue 0.73 times, while the Qualified Institutional Buyers (QIBs) subscribed the issue 4.23 times over the three-day period.  

Nuvoco Vistas Corporation - Positive and Negatives   

The Market Guru had advised investors to refrain from investing in this IPO. Investors with a long-term view of at least 3 years must only apply, he had recommended previously.  

Positives:   

1. Strong promoters with cement as a sector also doing well. There is no issue with the demand situation.  
2. The company has been growing inorganically as it has been buying other companies.   

Negatives:  

Entire focus only in northern and eastern parts of the country.  
The price of cement in this geographical area is lowest in the country, Singhvi had said. This does not give them enough pricing power, he further said.    
Another issue is that this company has debts on its books because of its inorganic growth plans.    
The valuations of the shares are quite expensive in terms of revenue growth and market cap, the Market Guru said. There are many alternatives to this cement company, he had said at the time of launch of the IPO.