DAM Capital Advisors Makes a Strong Market Debut Despite Lower-than-Expected Grey Market Premium
Shares of DAM Capital Advisors made a remarkable debut on the Indian stock exchanges on Friday, December 27, 2024, with both the NSE and BSE witnessing a strong listing. The company’s shares opened at INR 393 on the NSE, marking a 39% premium over its issue price of INR 283. On the BSE, the shares listed at INR 392.9, a slightly lower premium of 38.83% compared to the issue price.
This strong listing provided a profit of around INR 110 per share for investors who were allotted shares during the IPO. However, while the listing was positive, it came in below grey market expectations. Before the listing, DAM Capital shares had been trading in the grey market at INR 448, reflecting a premium of 58.3% over the issue price.
A Disappointing Outcome for HNI Investors
The listing performance was somewhat disappointing for High Net-Worth Individuals (HNIs), who had high expectations due to the elevated grey market premium. HNIs typically use financing options like loans to fund their IPO bids, so the lower-than-expected listing gains could be a setback for them.
DAM Capital Advisors IPO Details
The DAM Capital IPO was an Offer for Sale (OFS), with 2,96,90,900 shares on offer, amounting to INR 840.25 crore. The IPO was available within a price band of INR 269-283 per share, with a lot size of 53 shares. The offer garnered significant investor interest, with a massive 81.87 times oversubscription by the end of the subscription window on December 23, 2024.
A Business With Strong Fundamentals
Despite the muted market debut relative to the grey market expectations, DAM Capital Advisors has strong fundamentals backing its growth. The company is a cash-rich investment bank, having achieved an impressive CAGR of 38.77% in revenue from FY22 to FY24. In FY24, it reported the highest profit margins among its peers.
The company, led by Dharmesh Mehta, employs a skilled team of 29 research analysts and 34 broking division employees as of October 31, 2024. DAM Capital Advisors provides services to 263 active clients, including registered Foreign Portfolio Investors (FPIs) across various global markets, such as India, the USA, the UK, Hong Kong, Singapore, and more.
A Solid Long-Term Play
While DAM Capital’s IPO may not have met the high grey market expectations, the company remains a strong player in India’s fast-growing investment banking sector. With its robust financial performance and a strong client base across global markets, DAM Capital Advisors presents a solid long-term investment opportunity, despite the modest debut.
