On the NSE, shares of MSTC opened at Rs 115, a 4 percent discount to the issue price. It touched a high of Rs 120 and a low of Rs 111
Shares of MSTC were locked in the upper circuit of 5 percent at Rs 117 in intra-day trade on the BSE after making a weak debut. The stock is listed at Rs 111, 7.5 percent below its issue price of Rs 120 on the BSE. It has hit an intra-day low of Rs 110 so far.
Up to 10:11 a.m., around 31,000 equity shares had changed hands, and there were pending buy orders for 13,128 shares on the BSE.
On the National Stock Exchange (NSE), shares of MSTC opened at Rs 115, a 4 percent discount to the issue price. Exchange data shows that they touched a high of Rs 120 and a low of Rs 111.
MSTC is a leading public sector undertaking that provides e-commerce-related services mainly to government entities. Its services include e-auction/e-sales, e-procurement services, and the development of customized software/solutions.
The Rs 226-crore offer comprised an offer for sale by the government of India of 7.04 million shares. The objectives of the issue are to carry out the divestment program of the government of India apart from the benefits of listing the equity shares on the BSE and the NSE, enhancing its visibility and brand image, and providing liquidity to its existing shareholders. The government of India will hold 74.9 percent of the company’s total paid-up equity share capital post-listing.
Future key revenue drivers for MSTC’s e-commerce segment would be the spectrum auction for the telecom players, auction of coal blocks for merchant mining, privatization of government assets & lands, etc. It expects increased business from the agricultural & forest producers, mainly through the recently launched JaivikKheti portal.
Choice Equity Broking had assigned a ‘subscribe’ rating to the issue.
“On the valuation front, the company is demanding a P/S valuation of 0.4x (to its FY18 sales) at a higher price band. Moreover, based on FY19E and FY20E sales, a P/S valuation of 0.3x is demanded. Considering the importance and positioning of its services among various government entities, favorable government policies for business growth, stable dividend payout, and improvement in the financial performance, the issue seems to be attractively priced,” the brokerage firm said in an IPO update.
