Hindustan Aeronautic makes a tepid debut

The state-owned aerospace and defence company Hindustan Aeronautics made a tepid debut on the stock exchanges on Wednesday as the share price of the company fell by 4 per cent from its issue price of Rs. 1,215 per share. 

The stock opened on the National Stock Exchange at Rs. 1,159 per share and on the Bombay Stock Exchange at Rs. 1,169 per share on Wednesday. The Rs. 4,229 crore IPO, offered at a price band of Rs. 1,215-1,240 per share had only attracted a subscription of 99 per cent. Qualified Institutional Buyers (QIB) investors oversubscribed the issue by 1.73 times, while retail investors subscribed 39 per cent and the non-institutional investors subscribed 3 per cent. 

The company had recorded a profit before tax of Rs. 3,583 crore in the fiscal year 2017, up by 12 per cent from its PBT of Rs. 3,207 crore in FY16. The languid response of the investors toward the IPO was attributed to the weak market sentiments and a broadly higher valuation of stocks in the market. 

At 10:53 hours IST on Wednesday, the stock was trading at Rs. 1,170.55 per share, higher by 0.13 per cent from its opening price and lower by 3.93 per cent from its issue price on BSE.