IDFC makes debut with 104 per cent premium

Shares in Infrastructure Development Finance Company (IDFC) made a strong debut on the stock exchanges on Friday. The IDFC stock closed at R...

Shares in Infrastructure Development Finance Company (IDFC) made a strong debut on the stock exchanges on Friday. The IDFC stock closed at Rs 69.55 on the Bombay Stock Exchange (BSE) compared with its IPO price of Rs 34, a premium of 104.5 per cent.

The shares opened at Rs 55 on the BSE and were trading at Rs 67 during the afternoon sessions, valuing the state-backed company at more than $1.7 billion.

The stock hit a day’s high of Rs 72, leaping from its initial public offering (IPO) price of Rs 34 on huge volumes of 98 million shares. On the NSE it closed at Rs 59.50 with a turnover of Rs 1,667.49 crore.

Story continues below this ad

IDFC’s sharp gain lifted other financial shares, with the main banking index rising 0.4 per cent while the BSE Sensex was down 0.3 per cent.

Investors’ perception of the company’s earnings potential had been clear when the IPO of 403.6 million shares, raising Rs 1,370 crore, was subscribed 37.7 times.

‘‘The company’s line of business has great potential,’’ said P.R. Dilip, director at portfolio management firm Equity Intelligence. ‘‘Since infrastructure is the need of the hour in the country, there’s scope to fund many projects and grow revenues.’’