Dixon Technologies soars 64% on listing, Bharat Road Network trades flat

Consumer electronics manufacturer Dixon Technologies (India) Limited (DTIL) made a robust debut on the bourses, listing at Rs 2,725, up 54 per cent over its issue price of Rs 1,766 per share.

The stock hit a high of Rs 3,020 on the BSE and ended the day at Rs 2,892, a gain of 64 per cent over the issue price.

Dixon Technologies raised Rs 600 crore from its initial public offering (IPO), which got an overwhelming response from investors. Overall, the issue was oversubscribed 82.6 times, receiving bids for 280 million shares against the total issue size of 2.38 million shares. The portion set aside for qualified institutional buyers (QIBs) was subscribed 135 times, that for non-institutional investors for 345 times and retail investors for 10.2 times.

The IPO proceeds from the fresh issue will be utilised for setting up a unit for manufacturing of LED TVs at the Tirupati facility and enhancement of backward integration capabilities in the lighting products vertical at Dehradun I facility, among other things.

DTIL has a track record of sustained growth in revenue and profitability. Over the last five fiscals ended March 31, 2017, it achieved a CAGR of 33.78 per cent in revenue from operations (net) and 44.36 per cent in Ebitda. "Its robust financial position illustrates not only the growth of its operations over the years, but also the effectiveness of allocation of capital and strong working capital management across its business," said a research note by HDFC Securities.

Meanwhile, Bharat Road Network (BRNL) made a tepid debut on the bourses, listing at Rs 204.9 on the BSE, a discount of 0.05 per cent over the issue price of Rs 205 per share. The shares closed at Rs 208.15 on the BSE, a gain of 1.5 per cent.

BRNL's Rs 600 crore IPO was subscribed 1.8 times, with the retail quota getting a maximum subscription of 5.5 times. The QIB and non-institutional segments were subscribed 1.3 and 1.6 times, respectively.

BRNL is a road BOT (Build, operate and transfer) , including DBFOT (Design, build, finance, operate and transfer) and DBFOMT (Design, build, finance, operate, maintain and transfer) company, focused on development, implementation, operation and maintenance of roads/highways projects.

While the company has a professional management team with strong asset management, execution capabilities and extensive industry experience, its ability to successfully bid or acquire a new project, as well as, manage growth and implement new technologies for business operations, remain key concerns, according to HDFC Securities.