Inox lists at 54% premium

Inox Leisure, promoted by Gujarat Fluorochemicals Ltd (GFL), was listed on the BSE at RS 185, a premium of 54.16 per cent over the issue price, and on the NSE at Rs 172. The issue price was Rs 120.

On the BSE, the scrip fluctuated between a low of Rs 168.05 and a high of Rs 200 before closing at Rs 179.15. The stock traded at high of RS 194.80 to a low of 167.05 on the NSE. On the BSE, 1.6 crore shares changed hands, while volumes stood at 2.6 crore on the NSE

Fidelity was the main buyer, which helped maintain the price during the day. The counter also saw 4-5 block deals.

According to a broker, the budget does not seem to have a negative impact on the stock and, in the short term, the stock is expected to touch Rs 220.

The company's strategy is of targeting the rich and consuming class in high traffic premium locations in commercial business districts or affluent residential areas such as Inox multiplex in Mumbai at Nariman Point is expected to lead to higher top line and margin expansion in the future.

Mitesh Mehta, vice-president of institutional sales, LKP Securities, said "The stock is aggressively priced and annual numbers have to show up to maintain the same price level. The company is headed for vertical expansion and the margins have to expand to grow."

The current P/E of the stock is around 30 and that of PVR is 27, so they are almost at the same level. The performance of stock depends on how far the P/E is stretched.

The budget is not likely to have any effect on the stock as it is a lifestyle company. The future of the company is determined by the growth of the economy.

The company has tied up with India's largest and the fastest growing retail chain, Pantaloon retail whereby the company holds first right to open a multiplex in Pantaloon's existing and future properties.