Patel Retail share price falls on profit booking after strong listing. What should allottees do?

Patel Retail share price fell on Tuesday's session on profit booking after a solid debut on the bourses. Patel Retail share price began the day at ₹300, reflecting a rise of 17.65% from the issue price of ₹255. Additionally, on the BSE, Patel Retail's shares made their debut at ₹305, representing a gain of 19.61% over the issue price.

At 12:02 IST, Patel Retail share price was trading at ₹293.95 apiece, down nearly 4% on the BSE, while the stock was trading 293.40 per share, down over 2% on the NSE.

The initial public offering (IPO) of Patel Retail had a bidding window that opened on Tuesday, August 19, and closed on Thursday, August 21. With a nominal value of ₹10, shares in the Patel Retail IPO are offered at prices ranging from ₹237 to ₹255. A minimum of 58 shares can be purchased, and they are available in multiples. On the final day of bidding, the subscription status for the Patel Retail IPO reached 95.70 times.

According to Master Capital Services, a brokerage firm, for short-term investors, securing initial gains by taking some profits is the most effective approach after such a robust debut. Nevertheless, some investors may opt to retain a portion of their shares due to Patel retail's strong growth potential. This is attributed to its private labels, value-driven retail model, and opportunities for growth in semi-urban regions.

The company, which currently has 43 locations in Thane and Raigad, intends to utilise the funds raised for corporate purposes, working capital, and debt repayment, which will help solidify its foundation. Before increasing their investment, medium- to long-term investors should monitor store expansion, profit margins, and execution.

The initial public offering of the company includes the issuance of 85.18 lakh new shares and an offer to sell 10.02 lakh shares from the promoters.

The capital obtained from the new shares will be used for repaying debt, meeting the working capital requirements of the company, and for general corporate purposes. Fedex Securities is the exclusive book-running lead manager, and Bigshare Services serves as the registrar for the offering.

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.

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