Syrma SGS Technology makes strong debut, settles 42% higher from issue price on first day

The stock initially got listed at Rs 262.00 apiece on the BSE, thereby registering a gain of 19.09 per cent from its offer price of Rs 220.00, while on the National Stock Exchange (NSE), it opened at Rs 260.00, up 18.18 per cent from the issue price.

Syrma SGS further rose from its opening levels and hit a 20 per cent upper circuit in the intraday trade, touching a high of Rs 314.40 on the BSE and Rs 312.00 on NSE during the intraday trade. The scrip eventually ended at Rs 313.05 on the BSE, up 42.30 per cent from the issue price while on NSE closed at Rs 312.00, up 41.82 per cent.

The market capitalisation of Syrma SGS Technology stood at Rs 5,516.85 crore, data from the BSE showed.

Over 5.99 crore (5,99,61,608) shares of Syrma SGS Technology were traded on NSE during the day while around 54.77 lakh (54,77,171) shares exchanged hands on the BSE, data from the respective stock exchange showed.

Syrma SGS Technology is a technology-focused engineering and design firm that is engaged in turnkey electronics manufacturing services (EMS) that specialises in precision manufacturing. Some of its top customers include TVS Motor Company, AO Smith India Water Products, Robert Bosch Engineering and Business Solution, Eureka Forbes and Hindustan Unilever.

The IPO was available for public subscription from August 12-18, 2022 and got subscribed 32.61 times by the final day.

Reacting to the robust listing, Santosh Meena, Head of Research at Swastika Investmart commented, “The company’s good listing can be attributed to positive market sentiments, outstanding prospects, and a good response from the investors. With a huge focus on R&D-based innovation and an experienced management team, the company has managed to enter into various growing segments like PCBA, Radio Frequency Identification (RFID), Electromagnetic and electromechanical parts, and other information technology-related products. The company’s geographically diversified manufacturing locations and the business model which starts from product concept design & focuses on every segment of the overall industry value chain give them a competitive advantage over other players.”

He further noted, “The issue was priced at a P/E of ~65X (Based on the Restated Consolidated Financial Information, RHP). However, we believe that the company deserves this premium multiple due to its phenomenal growth prospects. Those who applied for listing gains can maintain a stop loss of Rs 225. New investors can buy for the long term and existing investors are recommended to stay invested in the company.”

Ravi Singh, vice president and head of research at Share India Securities told indianexpress.com, “The segment in which Syrma SGS is dealing i.e., electronics manufacturing services has a positive outlook ahead. The company is also focusing on products bearing high margins. SSTL’s manufacturing facilities in Tamil Nadu are located in a special economic zone which allows it to avail of certain tax and other benefits. Investors may hold the stock with a medium to long term perspective.”