Mobikwik shares hit 20% upper circuit limit, now up 90% from issue price on listing day. Analyst views

One Mobikwik Systems Ltd (Mobikwik's parent) shares on Wednesday marked a stellar stock market debut. The stock today got listed at Rs 442.25 on BSE, a premium of 58.51 per cent over its issue price of Rs 279. It went on further to scale its 20 per cent upper price band of Rs 530.70. At this price, the scrip has rallied 90.22 per cent compared to the issue price.

Analysts said this successful listing hints at robust market interest and optimism regarding MobiKwik's future in the online payment market.

Shivani Nyati, Head of Wealth at Swastika Investmart, said, "The digital payment platform delivered an impressive listing gain. The IPO had garnered a remarkable subscription of 125.69 times, indicating massive investor interest despite its high valuation and competitive fintech landscape. The company's recent shift to profitability, coupled with the growing adoption of digital payments, boosted market confidence. However, sustaining this momentum would depend on its ability to maintain profitability and carve out a niche in the competitive fintech sector."

Given the high listing gains, investors are recommended to book profits, while those wanting to hold should set a stop loss at around Rs 400, Nyati suggested.

Bajaj Broking said, "The IPO was oversubscribed, with bids totalling approximately $4.7 billion, about 120 times the shares offered. This strong demand reflects investor confidence in MobiKwik's growth potential within India's expanding online payment market. The fintech sector is expected to grow significantly, which positions MobiKwik to capitalize on this upward trend. Overall, the successful listing indicates robust market interest and optimism regarding MobiKwik's future in the fintech industry."

Mobikwik offers products such as MobiKwik ZIP,ZIP EMI for consumers, and merchant cash advance for merchants through in-house models and strategic partnerships with lending partners. Its offerings utilize digital public infrastructure (DPI) such as Aadhaar, E-Nach, Digi-Locker and NSDL to provide seamless and digital-first experiences for users.

As of June 30, 2024, the company has 161.03 million registered users and has enabled 4.26 million merchants to make and accept payments both online and offline. MobiKwik ZIP is a flagship product that lets consumers buy now and pay later within 30 days, offering flexibility and easy repayment options.

For the three months ended on June 30 this year, the company reported a loss of Rs 6.62 crore with a revenue of Rs 345.83 crore. It clocked a bottomline of Rs 14.08 crore with a revenue of Rs 890.32 crore for the financial year ended 2023-24.