SRM Contractors shares closed at the upper circuit on listing day, April 3, indicating a strong buying interest from the participants despite volatility in the equity markets though the opening price was far lower than analysts' expectations.
The stock opened 7.1 percent higher at Rs 225 on the BSE, against the issue price of Rs 210, and immediately jumped to the upper circuit level of Rs 236.20, up 5 percent over the opening price.
It remained locked at the upper circuit for the rest of the session, rising 12.5 percent compared to the issue price.
Given the IPO size is below Rs 250 crore, the exchanges have a fixed circuit limit of 5 percent for SRM Contractors stock as it listed in the T group. The stock will remain in trade-for-trade segment for another nine days. This means the shares can be traded only on a delivery basis and intraday trading or buy today sell tomorrow (BTST) is not allowed in T2T stocks.
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The stock closed at Rs 226 on the NSE, up 7.62 percent over the issue price and 5 percent over the opening price of Rs 215.25, with volume of 10.1 lakh equity shares, while the traded volume on the BSE was 3.48 lakh shares.
The Jammu & Kashmir-based EPC contractor has raised Rs 130.2 crore through its initial public offering which comprised only a fresh issue. The price band for the issue was fixed at Rs 200-210 per share.
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The construction and development company that is involved in the construction of roads, bridges, tunnels, and slope stabilisation works in the Union Territories of Jammu and Kashmir and Ladakh is going to spend fresh issue money for the purchase of equipment/machinery; repaying debts; working capital requirements; investment in project-specific joint venture projects; and general corporate purpose.
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