Sigachi Industries is second-best debut by an IPO in India; what should investors —Experts take

Sigachi Industries stocks zoomed to Rs 603.75 per share, a gain of Rs 440.75 or 270.40% on its issue price of Rs 163 per share on its debut day on the BSE on Monday. Shares of manufacturer of cellulose-based excipient made a dream debut on bourse on Monday as the scrip rose 252.76% to Rs 575 per share against its issue price.  

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It is only the second-best debut by any IPO in the history of Indian primary market. Earlier in 2006, Tantia Constructions had delivered a whooping 260 per cent listing gain at Rs 180 against an issue price of Rs 50.  

Talking about this dream debut, Ravi Singhal, Vice Chairman at GCL Securities, said lucky bidders should book 50 per cent profit and recover their principal and keep the rest 50 per cent stocks in their portfolio. “They should hold Sigachi Industries shares for the one-month target of ₹888, maintaining a stop loss at ₹530 per share levels," said Singhal.  

Rahul Sharma, Co-Founder, Equity99, advised shot-term investors to book profits as their capital is almost 3x in 10 to 15 days. " Long-term investors are advised to remain invested considering niche product offerings of the company. For fresh Entry, the advice would be to wait for declines and not to enter fresh at the listing gains of 267%," he said.  

One may book profits as the gains are more than 100%, said Manoj Dalmia, Founder and Director, Proficient Equities on post listing, adding that one can expect a further increase in price in the coming weeks if earnings are positive.  

Existing shareholders are advised to hold the stock with an SL of 480 while the new investors are advised to wait till the stock prices cool off, said Parth Nyati, Founder, Tradingo.

"The company is the leading manufacturers of MCC (cellulose-based excipient) in India with diversified industry verticals. IPO was valued at 16x FY21 with no listed peer. Over the long run, if the demand is sustained for MCC and the expansion program of the company post the IPO will provide earnings growth momentum," he said.