Street signs: Mean revision in TaMo DVR, GMPs for Elin & KFin, and more

Since November, shares of Tata Motors have remained flat, while the DVR has crashed 14 per cent. The grey market premiums (GMPs) for the two IPOs that open this week are mixed

Mean revision in TaMo DVR
 

The Tata Motors DVR had narrowed its discount to the ordinary shares to 40 per cent during the start of November. This was on expectation that both the DVR and ordinary shares will get added to the benchmark Sensex. Those hopes got dashed as a tweak in index inclusion criteria saw only the ordinary shares making it to the index. Since November, shares of Tata Motors have remained flat, while the DVR has crashed 14 per cent. This has once again widened the discount to close to 50 per cent between the two—which has been the average spread over the past five years. Analysts say liquidity in the DVR could be a concern, especially as only the ordinary shares have made it to the Sensex. They say investors can look to buy the DVR if the discount widens to 55 per cent levels and look to sell if it falls too much below 50 per cent.

Mixed GMPs for Elin, Kfin
 

The grey market premiums (GMPs) for the two IPOs that open this week are mixed. According to sources, shares of Elin Electronics are commanding a GMP of more than 15 per cent, while that of KFin Technologies are less than 5 per cent. “The two IPOs that closed last week got a lukewarm response. The investor interest towards IPOs isn’t that great at the moment. One or two blockbuster issues early next year could boost sentiment,” said a broker. Electronics manufacturing services company Elin’s IPO size is Rs 475 crore, while that of mutual fund registrar is Rs 1,500 crore.

Listed hospitals gaining strength
 

Listed hospital chains are attracting investor interest as the revenue metrics of listed hospital chains have shown a positive momentum after the pandemic. "Occupancy levels have largely recovered to pre-pandemic levels, and we expect it to sustain in the range between 65 per cent and 75 per cent. EBITDA margins have improved vs the pre-pandemic levels due to increased average revenue per occupied bed (ARPOB) and cost-saving initiatives undertaken during the pandemic," says a note by Nomura. Moreover, acquisitions of smaller hospitals by larger chains and the market share shift from unorganised players to organised players present significant scope for consolidation in the hospital space, analysts say.