Hudco lists with a bang on bourses

State-run Housing and Urban Development Corporation Ltd (Hudco) today made a strong debut on bourses as investors sought to buy into the property sector of a country where housing demand is among the highest in the world.

By Our Bureau in Mumbai
  • Published 20.05.17
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Mumbai, May 19: State-run Housing and Urban Development Corporation Ltd (Hudco) today made a strong debut on bourses as investors sought to buy into the property sector of a country where housing demand is among the highest in the world.

At the close of the trading session today, the Hudco scrip was up almost 21 per cent over the issue price of Rs 60.

After listing on the Bombay Stock Exchange (BSE) at Rs 73.45, up 22.41 per cent, the stock touched a high of Rs 77.80, gaining 29.66 per cent in intra-day session. It closed at Rs 72.50, a 20.83 per cent rise over the issue price.

On the National Stock Exchange (NSE), the stock surged 20.91 per cent to close at Rs 72.55.

The company commands a market valuation of Rs 1,479.43 crore. In terms of volume, 303.12 lakh shares of the company were traded on the BSE and over 21 crore shares changed hands at the NSE during the day.

Hudco is the first public sector company to list on stock exchanges since April 2012.

The strong debut bodes well for plans by other state-run companies looking to list this year, as the government aims to raise Rs 72,500 crore in the current financial year from public sector asset sale to shrink its deficit.

"With the government's focus on affordable housing and public infrastructure, Hudco has a bright future indeed for long-term investors," said Naveen Jain, proprietor at Chandan Shares.

"It is an awesome listing and the first this fiscal from the government in the backdrop of 10 more government IPOs lined up," Jain said.

The government sold just over a tenth of its stake in the initial public offering of Hudco that raised Rs 1,220 crore ($188 million).

Response roster

The Hudco flotation saw huge demand from investors and was subscribed 79.53 times. While the qualified institutional buyer portion was subscribed 55.45 times, the non-institutional category saw a staggering 330.36 times subscription and retail investors 10.79 times.

The IPO received bids worth Rs 97,000 crore. The price band for Hudco, which concluded its initial public offer on May 11, was set at Rs 56-60 a share.

"The over-subscription is a testimony of faith reposed by investors in a company backed by quality leadership and management, strong business model and a great track record," said Ajay Saraf, executive director, ICICI Securities.