Adani Wilmar share price surges over 17% after weak stock market debut; should you buy, sell or hold?

Adani Wilmar share price rallied 17.4 per cent from the day’s low to Rs 259.50 apiece, after making a weak debut at stock exchanges. The stock has surged 13 per cent from the issue price of Rs 230. Analysts say that the stocks listed at a discount owing to the weaker sentiments of the secondary market in the last few trading sessions. “It is evident that investors who have subscribed the issue solely for listing gains would not be happy and can square off their positions in the range of Rs 260-265. Short term investors can hold the stock and book profits at 30-40 per cent i.e they can book profits at Rs 290-300,” Likhita Chepa, Senior Research Analyst at CapitalVia Global Research, told Financial Express Online.

Chepa also added that advised long-term investors can consider holding or buying this stock, given its wide distribution, healthy financials, strong brand recall, increasing reach and household consumption, its prospects appear to be optimistic over the long term. 

The market capitalisation of Adani Wilmar has also jumped to Rs 33,746.15 crore from Rs 28,722.90 crore at listing.  In traded volume terms, a total of 44.09 lakh shares have been traded on BSE, while 9.67 crore shares exchanged hands on NSE so far in the day. Despite an expectedly decent listing and relatively strong fundamentals, investors are advised to book partial profits in Adani Wilmar due to a weak market sentiment, Pavitraa Shetty, Co-founder & Trainer, Tips2Trades, told Financial Express Online. Shetty added saying that a dip of about 10-20% from current levels should be used to re-enter for better returns.

Adani Wilmar IPO was subscribed 17 times. The retail investors section was subscribed 3.92 times, while non-institutional investors bid for 56 times more shares than the 2.15 crore shares reserved for them. Qualified institutional investors put in bids for 5.73 times of the portion reserved for them. Analysts say that the tepid listing of Adani Wilmar can be attributed to weak market sentiments otherwise fundamental and valuations were good for this IPO. “Those who applied for listing gain can maintain a stop loss of 200 while long-term investors should hold it. New investors can also look at buying opportunities at initial weakness,” Santosh Meena, Head of Research, Swastika Investmart, said.

(The stock recommendations in this story are by the respective research analysts and brokerage firms. Financial Express Online does not bear any responsibility for their investment advice. Capital markets investments are subject to rules and regulations. Please consult your investment advisor before investing.)

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