Shadowfax continues to trade in red after weak listing: Here's a stop loss if you have the stock

Shadowfax IPO listing

• Shadowfax Tech shares listed at a 9.19 percent discount to IPO price on NSE
• Analysts advise IPO allottees to hold with a strict stop loss at Rs 105
• Fresh investors should wait for price stability before considering entry

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The shares of Shadowfax Technologies made some recovery after making a weak market debut, but continued to trade in the deep red on January 28. Analysts have suggested what allotted investors should do.

The shares of the Bengaluru-based technology-led logistics solutions provider listed at 112.60 apiece on NSE, marking a discount of 9.19 percent over the IPO price of Rs 124 apiece.

The stock then recovered some losses, rising around 6 percent from its listing price to trade at Rs 119.67 apiece. However, it is still down around 3.5 percent from its IPO price of Rs 124 apiece.

What should investors do?

Shadowfax’s weak stock market debut indicates cautious investor sentiment towards the logistics and new-age business space, said Shivani Nyati, Head of Wealth at Swastika Investmart. The discounted listing suggests valuation concerns, and the stock may remain volatile or range-bound in the near term as markets focus on profitability, cash flows and execution, she added.

IPO allottees may hold with a strict stop loss at Rs 105 to protect downside risk, according to the analyst, who further said that fresh investors should avoid immediate entry and consider buying only after price stability, with a similar stop loss of Rs 104–105.

“On the upside, the ₹120–124 zone is likely to act as a resistance in the short term,” she added.

Shadowfax’s muted listing reflects valuation fatigue in the IPO market rather than doubts over the business, said Gaurav Garg, Research Analyst at Lemonn Markets Desk. "While the company boasts strong revenue growth and a pan-India logistics network, weak non-institutional demand and thin listing sentiment capped upside. Near-term stock performance will now hinge on execution, margin improvement and sustained profitability rather than growth alone," he added.

Shadowfax is a technology-driven, asset-light logistics company focused on last-mile delivery, express parcels, reverse logistics and quick commerce services, said Mahesh M. Ojha, VP Research and Business Development at Kantilal Chhaganlal Securities. The company operates across more than 2,300 cities and 14,700 PIN codes and serves clients such as Flipkart, Meesho, Swiggy, Blinkit and Nykaa.

According to him, the stock may be suitable for high-risk investors given the overall positive industry outlook. Investors with a long-term perspective who have already applied may consider holding the stock, while short-term investors could look to book gains on listing, if any. Fresh investors may wait for price discovery after listing.

Shadowfax Tech IPO:

The weak market debut comes despite the IPO of Shadowfax Technologies closing with 1.68 times subscription during its three days of public bidding between January 20 and January 22. Retail individual investors (RII) and qualified institutional buyers (QIB) had booked their respective reserved portion more than 2 times, while non-institutional investors (NII) subscribed 54 percent of their allotted quota.

Bengaluru-based technology-led logistics solutions provider Shadowfax Tech moved to the primary capital market to raise Rs 1,907.2 crore through its initial public offering (IPO), which comprised a fresh issue of shares worth Rs 1,000 crore and an offer for sale (OFS) of shares worth Rs 907.2 crore by several investors including Flipkart, Eight Roads Investments, Qualcomm, and NewQuest Asia Fund.

The price band for the IPO was set at Rs 118-124 per share. Investors could bid for a minimum of 120 shares, requiring an investment of Rs 14,160, and in multiples thereafter.

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