ideaForge shares tank 10% on profit-booking after bumper listing

After the overwhelming listing, analysts had advised investors to book profits.

Anubhuti Mishra, Equity Research Analyst at Swastika Investmart, recommended that investors should book profits and exit their positions.

“There are some business-related risks associated with the company. So, it is better to lock in these gains now rather than take the risk of carrying them forward. However, aggressive investors can still hold the stock with a stop loss of Rs 1170,” Mishra added.

Meanwhile, Prashanth Tapse, Sr VP – Research at Mehta Equities, said, “Post listing, the valuation would be stretched and difficult to sustain and recommend allotted investors should book profits on the listing day while risky fancy investors can hold for medium to long term to play on drone demand.”

The IPO, which comprised a fresh equity issue of Rs 240 crore and an offer for sale (OFS) of 48.6 lakh shares, was subscribed over 100 times on strong institutional and retail interest.

ideaForge primarily caters to customers with applications for surveillance, mapping, and surveying. Its customers include the armed forces, central armed police forces, state police departments, disaster management forces, and forest departments, besides other civil customers.It is one of the first few companies in India to enter the UAV market.

The Mumbai-based company is backed by marquee investors, including Infosys, Qualcomm, Celesta, Florintree, EXIM Bank, Indusage Technology Venture Fund, and Infina Finance.

Industry-wise, the government has put in place several laws and policies that address both the supply side (through PLI and import bans) and demand side (through drone policy) issues.

India also has a remarkable opportunity to target approximately 1.8 lakh crore of total domestic manufacturing potential from the UAS space, according to experts.

The proceeds from its fresh issuance to the tune of Rs 50 crore will be utilised for repayment of certain indebtedness availed by the company, Rs 135 crore towards funding working capital requirements, Rs 40 crore for investment in product development and general corporate purposes.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)