40% SME companies that migrated to main board now trading in the red

Sixty-eight companies that listed on the SME (small and medium enterprises) platforms of the BSE and NSE have migrated to the main boards of these exchanges since 2012

Of these, nearly two out of five companies are trading in the red over their issue price. Among the losers, eight have lost more than 75 per cent of their value, with Bronze Infra-tech and Edynamics Solutions shedding more than 98 per cent each. 

Some investors have been rewarded. Four companies — Suyog Telematics, SRG Housing Finance, Vishal Fabrics and BC Power Controls — have gained above 1,000 per cent over their offer price. Another 30 firms have risen between 108 per cent and 982 per cent. 

Analysing SME firms can be tough as they are not tracked by analysts and there is limited data in public domain. Investors are left to themselves when it comes to gauging credibility of promoters. So while there is a possibility of high returns, there is a chance of losing one’s entire capital, said experts.

The last financial year was the second best for SME IPOs, with more than 100 offerings mopping up more than Rs 1,600 crore. To date, 466 SMEs have listed on the bourses and garnered over Rs 5,500 crore.