ECOS Mobility shares expected to list at 45% premium over IPO price on September 4

ECOS Mobility has been providing chauffeured car rentals (CCR) and employee transportation services (ETS) to corporate customers for more than 25 years.

The shares of Ecos (India) Mobility & Hospitality will be listed on the bourses on September 4. The Rs 601 crore share sale was subscribed 64.18 times on the last of subscription on August 30, receiving bids for over 80 crore shares against 1.26 crore shares on offer.

The Delhi-based company has been providing chauffeured car rentals (CCR) and employee transportation services (ETS) to corporate customers for more than 25 years.

Akriti Mehrotra, Research Analyst at StoxBox expects the issue to list at a premium of 45 percent over its upper price band. "As the industry embraces digital solutions, ECOS is well-positioned to leverage its operational excellence and advanced technology for continued growth and leadership. The company’s financials show robust growth over three fiscal years, with total revenue increasing from Rs 1,473.4 million in FY22 to Rs 5,544.1 million in FY24, reflecting a CAGR of approximately 94.0 percent," she said.

The company has a fleet of more than 9,000 vehicles from economy to luxury cars. It also provides speciality vehicles like luggage vans, limousines, vintage cars and vehicles for accessible transportation for people with disabilities.

Prashanth Tapse, Sr VP Research – Research Analyst at Mehta Equities Ltd expects the issue to generate decent listing gains over and above 20 percent on the issue price on the back of market optimism.

After listing on the valuation front, it can move from reasonable value to stretched valuations, which would be reason for profit booking attempts at high levels, he added.

According to multiple websites that track the grey market premium activities, the shares of ECOS Mobility are commanding a GMP in the price range of Rs 160 in the unregulated market. Shivani Nyati, Head of Wealth, Swastika Investmart Ltd, reiterated the same stating that the IPO garnered significant investor interest, evidenced by a robust subscription rate of 64.18 times and a substantial grey market premium (GMP) of Rs 160 (47.90 percent).

She added that given the mixed financial performance and elevated valuation, investors may want to adopt a wait-and-watch approach for the long term. However, strong market demand for the IPO, as reflected in the subscription rate and GMP, suggests potential for a positive listing.