Vedant Fashions' listing defies pessimism, what should investors do now?

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26 Aug, 2025 12:21

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Vedant Fashion, owner of men’s celebration wear brand Manyavar, defied pessimism on the Street after it listed at a premium of 8 percent to its issue price at Rs 931 per share on the National Stock Exchange on February 16.

Ahead of its market debut, several analysts had suggested that Vedant Fashion could list at a discount given its perceived expensive valuations and the relatively muted response of investors to the initial public offering.

“The valuation of Vedant Fashions looks expensive and investors will not have much space. The primary market sentiments have nosedived amid sell-off in the broader market. So we expect the IPO to list at a discounted price of around 3-5 percent,” Ravi Singh, vice president and head of research at ShareIndia had said.

Also read: Vedant Fashions IPO: Stock makes a decent debut, lists with 8% premium

The company’s public issue was subscribed 2.57 times after the three-day process, with qualified institutional buyers in the lead. QIBs subscribed to 5.4 crore shares of the company against the allotted portion of 72.7 lakh shares.

The company raised Rs 3,149.19 crore through its public issue that was entirely an offer for sale by promoter and investors.

The consumer discretionary company is largely a play on the growing Indian middle-class and commands valuations of close to 100 times price-to-earnings multiple.

“The company has strong brand value with good fundamentals, however, valuation is a major concern, therefore, investors should approach it from the long-term perspective where any dip of 15-20 percent from current levels will be a good buying opportunity,” said Santosh Meena, head of research at Swastika Investmart.

Analysts believe that the premium listing of the stock could be used by IPO investors to exit, as the expensive valuation leaves little headroom for further gains.

“If non-allotted investors wish to buy on the listing day, it is better to wait and watch for better discounted pricing, while risk-takers may consider holding it as a high-risk high-return with a long-term perspective,” said Prashanth Tapse, vice president of research at Mehta Equities.

At 10.20 am, shares of Vedant Fashions were up 12.5 percent at Rs 974 on the National Stock Exchange.