Multibagger IPO: Money is not made by buying and selling stocks but by holding them as long as possible. However, sometimes, one's money can rise many folds quickly. This can happen in stocks and IPOs because investing in stocks or IPOs is like investing in a business.
Those who want to believe only when there is an example. Then, we have Pavna Industries' IPO to showcase the power of stock market investment for such investors. This SME IPO was offered last February 2024 at ₹165 per equity share. The public issue was proposed for listing on the NSE SME Emerge platform with a flat listing of ₹165 per share. However, the SME stock witnessed a strong uptrend in the next three years. The SME stock peaked at ₹640.85 apiece in January 2024, almost quadrupling an allottee's money in nearly three years. Pavna Industries share price is currently oscillating around ₹490, which is near 200 percent higher than the Pavna Industries IPO price band of ₹165 apiece. So, if an allottee of the SME IPO had remained invested in this share despite flat listing, its money would have tripled today.
As mentioned above, Pavna Industries shares were proposed in the primary market at ₹165 per share in the last week of February 2021. The public issue was proposed for listing on the NSE SME Emerge platform. The SME stock was listed on NSE on 9th March 2021. A bidder was allowed to apply for the SME IPO in lots, and one lot comprised 800 company shares.
Pavna Industries shares had a flat debut on Dalal Street, listed at ₹165 on the big day. However, the SME stock witnessed strong buying post-listing and slowly but steadily continued to scale new peaks in the last three years. In January 2024, the SME stock touched a new peak of ₹640.85 apiece. However, it retraced from its record high, and today, Pavna Industries' share price is around ₹490.
Pavna Industries' IPO lot size was 800, and one share of the company was offered in the primary market at ₹165. This means the minimum amount required to apply for the SME IPO was ₹1,32,000 ( ₹165 x 800). Pavna Industries share price today is ₹490. So, if an allottee had stuck with its conviction despite the flat debut of the SME stock, the absolute value of one's ₹1.32 lakh would have turned to ₹3.92 lakh today. So, ₹1.32 lakh of an allottee would have turned to ₹3.92 lakh today, provided the allottee had remained invested in the scrip to date.
Disclaimer: The views and recommendations provided in this analysis are those of individual analysts or broking companies, not Mint. We strongly advise investors to consult with certified experts before making any investment decisions, as market conditions can change rapidly and individual circumstances may vary.
