RBZ Jewellers shares hit upper circuit after muted listing. Should you buy or sell?
RBZ Jewellers made a flat listing on the exchanges on Wednesday. However, post the listing, the stock jumped 5% and was locked in the upper circuit.
The debut was in line with the subdued grey market trend, reflecting cautious investor sentiment towards the company despite its strengths.
While RBZ Jewellers possesses strong fundamentals and a fair valuation on the surface, the significant risks cannot be overlooked, analysts said.
«The flat listing serves as a stark reminder of the potential pitfalls associated with gold price volatility, client concentration, informal artisan arrangements, and intense competition.
Thus, investors are suggested to exit their positions,» said Shivani Nyati, head of wealth at Swastika Investmart.
The public offer of RBZ Jewellers was subscribed 16.72 times at close. The retail portion was booked 24.45 times and the non-institutional investors' portion was subscribed 9.25 times.
The category reserved for qualified institutional buyers (QIBs) got 13.43 times the subscription.
The IPO was completely a fresh issue of 1 crore shares with no offer for sale (OFS) segment. The proceeds will be used to fund working capital requirements and for general corporate expenses.
RBZ Jewellers is an antique gold jewellery maker with a history spanning over 15 years in the industry.
