India Shelter Finance shares fall 10% post listing. Should you hold or sell?
India Shelter Finance made a decent debut on the exchanges on Wednesday by listing at a premium of around 25% over the offer price.
However, the stock gave up some of the gains after falling nearly 10% post the debut. It is currently trading at Rs 556, just 12% higher than the IPO price.
Net proceeds from the issue of fresh equity issue will go towards meeting future capital requirements and general corporate purposes.
Analysts said there is still value in holding the stock from a medium- to long-term perspective as the company boasts of strong fundamentals and delivered strong financial performance in the last few years.
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Should investors book profits?
«With credit growth in the housing segment expected to remain robust in the medium term and ISFC commanding premium yields, we advise investors who have received allotment to hold shares from a medium- to long-term perspective and not get swayed away to book listing gains,» said Shreyansh Shah, Research Analyst, StoxBox.
At the upper price band of Rs 493, the company is valued at P/BV of 2.4X with market cap of Rs 5,278 crore post the issue.
The company is a retail-focused, affordable housing finance company with an extensive distribution network and a scalable technology infrastructure. Between FY21 and FY23, it witnessed a two-year CAGR growth of 40.8% in terms of assets under management (AUM).
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Should you apply?
It offers loans of up to Rs 50 lakh to urban households for construction, extension, renovation and purchase of new homes. It has one of the fastest growing AUMs among housing finance companies in India, high yields and a granular,
