Paras Defence and Space Technologies (PDSTL) made an impressive entry into the selling market when its stock price rose 171 per cent to list at Rs 475 on the BSE on Friday. The company issued shares at Rs 175 per share. Post listing, the stock zoomed 185 per cent over the issue price and was locked in the upper circuit of 5 per cent at Rs 498.75 on the BSE.
Till 1:10 pm, around 7.41 lakh equity shares of the company had changed hands on the BSE. There were pending buy orders for 6.46 lakh shares on the exchange. In comparison, the S&P BSE Sensex was down 0.67 per cent at 58,728 points.
PDSTL has been admitted to dealings on the exchange in the list of 'T ' group of securities, the BSE said in a notice. In the trade-to-trade or T2T segment, each trade (buy or sell) has to result in delivery and no intra-day netting of positions is allowed.
In a notice to its trading members ahead of the listing of Paras Defence, BSE said, “Trading Members of the Exchange are hereby informed that effective from Friday, October 1, 2021, the equity shares of Paras Defence and Space Technologies Limited shall be listed and admitted to dealings on the Exchange in the list of 'T ' Group of Securities. Further in terms of a circular by the Securities and Exchange Board of India in February 2012, the stock of Paras Defence will be in Trade-for-Trade segment for 10 trading days.”
According to dealers, the stock is expected to stay at elevated levels as it is expected to be traded in the T2T category for the next 10 days.
Hemang Jani, head, equity strategy, broking and distribution, Motilal Oswal Financial Services, says “We like Paras, given its complex and wide product portfolio, presence in the niche defence space, strong client relationship and high entry barriers. Given the huge impetus on defence by the government, the stock presents a good opportunity for investors.”
The company is looking to tap import substitution opportunities under the Government of India’s (GoI) Atmanirbhar Bharat and Make in India initiatives. The government’s outlay is expected to increase at a 16 per cent compounded annual growth rate (CAGR) to over $14.5 billion by 2031. The company would be especially focusing on optics and drones which now forms about 67 per cent of the order book.
The initial public offering (IPO) of PDSTL witnessed the highest-ever subscription, with the issue garnering 318 times bids. The retail portion of the issue was subscribed 113 times, while the institutional portion garnered 170 times subscription. The high net-worth individual (HNI) portion was subscribed 928 times, according to data.