Year-ender 2021: 6 out of 11 new age companies witness mute listing in 2021; know why you must avoid Paytm, RateGain, for now

At least 11 new generation companies got listed this year mopping up over Rs 47000 crore from the primary market. Six out of these 11 companies had reported negative/mute growth post listing and Paytm, Car Trade and RateGain Travel and Technologies were the top three laggards.

One-97 Communications backed Paytm, which got listed at discount of over 9 per cent at Rs 1950 per share as compared to upper end issue price of Rs 2150 per share was one of the most hyped public issues and also the biggest in over a decade.

The stock has so far corrected around 38 per cent from issue price much to the disappointment of its investors. The Rs 18,300 crore issue was subscribed 1.9 times during three-day period.

It is a loss-making company, apart from the uncertain business model, Vikas Sethi of Sethi Finmart said. He added that Paytm's monopoly mobile wallet segment is facing huge competition from Phone Pe and Google Pay. The combined market share is around 80 per cent in this segment.

His recommendation to investors is to avoid investing in this stock for now as he sees a further downside in the share price.

The next shocker was from Car Trade. The company’s IPO received stupendous subscription of over 20 times, which was completely an offer for sale (OFS. It was listed at a 1 per cent discount from issue price of Rs 1618 per share. The stock has corrected almost 50 per cent to Rs 800 apiece level since listing.

Car Trade IPO also been a disappointed to investors despite good subscription on the back of aggressive and expensive valuations, Sethi said.  He was not comfortable with this stock even at current levels as he feared the businesses may see erosion. His advice was an avoid on this scrip. 

RateGain Travel and Technologies, which mainly caters to travel and hospitality sector, listed at 15 per cent discount and has corrected 7 per cent, so  far from the issue price of Rs 425 per share. The IPO of RateGain was subscribed 16 times during three-day period.

The company excellent with a splendid business model, says the Managing Director of Sethi Finmart. Once the omicron fears subside, the stock is likely to soar, he opines. It has the potential to reach Rs 450 per share levels going forward.

The other three companies that reported either mute/average or weak listing and yet to shine on the exchanges are Fino Payments Bank, PB Fintech-backed PolicyBazaar and Easy Trip Planners.

New-age companies IPO launched in 2021

Fino Payments Bank Limited

One 97 Communications Limited (Paytm) 

MTAR Technologies Limited

Nazara Technologies

Easytrip Planners

CE Info Sytems Limited (MapmyIndia)

FSN E-commerce Ventures (Nykaa),

Zomato Limited

Cartrade Tech Limited

PB Fintech Limited

Rategain Travel Technologies Limited