Infibeam gains 3% on debut

Shares ended at Rs 445.55, 3% higher compared to issue price of Rs 432 on NSE

The Infibeam stock on Monday ended three per cent higher at Rs 445.55, compared to the issue price of Rs 432 on the National Stock Exchange on its market debut. The stock touched an intra-day high of Rs 440 and a high of Rs 453 on the NSE. About Rs 100 crore worth of shares changed hands on the NSE and BSE, data showed.

Infibeam’s initial public offering, touted as the first by an e-commerce firm in the domestic market, garnered a lukewarm response. The Rs 450-crore IPO was subscribed only 1.31 times, with mutual funds giving a complete miss to the issue.

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The retail and rich investor segment was subscribed 1.5 times and 2.62 times, respectively. The issue had seen 40,000 retail applications, only eight applications from institutional investors and another 106 applications from non-institutional or high net worth individuals. About 75 per cent of the issue was reserved for institutional investors.

Analysts had expressed their concerns over the high pricing of the offering. According to them, the company was valued at over six times its enterprise value (EV) to sales. In comparison, global e-commerce players, such as Alibaba and Amazon trade at just four times EV/sales.

On Monday’s closing price, Infibeam is valued at Rs 2,366 crore.  The company had clocked revenue of Rs 175 crore and net profit around Rs 6.2 crore during the April-September 2015 period.