CMR Green Tech shares slip 10% from listing high; what should investors do now?

Shares of CMR Green Technologies made a strong market debut on Wednesday as the metal recycler got listed at Rs 275.40 on BSE, marking a 43.44 per cent premium over the initial public offering (IPO) price of Rs 192 (upper band). Later, the stock slipped 10 per cent from the listing price to hit a low of Rs 247.90 as the maiden session progressed.

The Rs 631-crore initial share sale of CMR Green received bids worth more than Rs 56,200 crore. The robust demand was led by institutional buyers who made bids worth Rs 33,976 crore.

As per BSE, investors placed bids for 2,92,75,44,594 equity shares, or 127.04 times, compared to the 2,30,43,930 equity shares offered. The allocation for qualified institutional bidders (QIBs) was subscribed 270.46 times on the final day, while the portion reserved for non-institutional investors (NIIs) saw a subscription of 172.35 times. The retail investors' portion was booked 27.03 times and the category kept for employees was booked 18.53 times.

The IPO was priced in the range of Rs 182-192 per share and comprised entirely an offer for sale (OFS) of up to 3.28 crore equity shares by the promoters and an investor-selling shareholder.

What should investors do now?

Ravi Singh, Chief Research Officer at Master Capital Services, said, "The company mainly operates in the aluminium recycling business, a segment that is gaining importance as India focuses more on sustainability and circular economy initiatives. Going ahead, the stock's long-term performance will largely depend on execution, earnings growth and how well the company expands its business in the evolving green-tech space. Investors are advised to book listing gains and can consider fresh buying around Rs 200-220 levels."

Kranthi Bathini, Director of Equity Strategy at WealthMills Securities, stated, "Those who invested with the objective of capturing listing gains should consider taking profits at the current levels. For any long-term investment, investors should wait for the quarterly earnings."

The Faridabad-based firm is a non-ferrous metal recycler and secondary aluminium market, specialising in aluminium and zinc die-casting alloys. It manufactures recycled aluminium alloys, zinc alloy ingots and segregated furnace-ready scrap of stainless steel, copper, brass, zinc, lead and magnesium, amongst others.