Policybazaar stocks surge nearly 10% on issue price to Rs 1,249; what should investors do now?

Policybazaar stocks surged nearly 10% to the day's high of Rs 1249 per share, soon after listing on the BSE on Monday. Shares of Policybazaar was trading with gain of over 26 per cent on its issue price at 12.35 pm. The stock was available for trade at Rs 1238.05, up 88.05 or 7.66%. Policybazaar stocks were listed at a premium of over 17% on the Bombay Stock Exchange on Monday. The shares of PB Fintech Ltd's Policybazaar opened at Rs 1150, up Rs 170.00, a piece against issue price of Rs 980 per share.

Talking about what should be investors strategy post listing, Aayush Agrawal, Senior Research Analyst - Merchant Banking, Swastika Investmart Ltd, said, "The company is a leading Fintech firm that aims to enhance its visibility and awareness along with increasing its customer base which is expected to be beneficial for the company. The existing investors are advised to hold the stock with a Stop Loss of Rs 1,050, while the new investors can look for a dip. We believe the company can perform much better over the long run."  

See Zee Business Live TV Streaming Below:

Manoj Dalmia, Founder and Director, Proficient Equities on post listing, said that the issue appears overvalued. "The issue seems overvalued at 46x FY22 M-cap/Sales on a post-issue basis suggesting to book profits. Expect a good demand if earnings are positive in the coming weeks," he said.  

Earlier, the Rs 5,710-crore initial public offer (IPO) of PB Fintech Ltd (PBFL), which operates online insurance marketplace Policybazaar and credit comparison portal Paisabazaar, opened for subscription on November 1 and closed on Wednesday November 3, 2021.  

The company has fixed a price band of Rs 940 - 980 per share for this IPO.  

The issue comprised fresh and OFS. Shares for the fresh issue is 3.827 - 3.989 crore shares and OFS is 2- 2.084 crore shares.  

The company will not receive any proceeds from the OFS part of the issue. Of the net proceeds from the fresh issue, Rs 1,500 crore will be used for enhancing the visibility and awareness of its brands, Rs 375 crore will be utilized in funding new opportunities, Rs 600 crore will be used for funding strategic investments and acquisitions and Rs 375 crore will be used to expand business outside India. Residual funds will be used for general corporate purposes.