NSDL shares soar 76% from IPO price; analysts eye profit booking

Shares of National Securities Depository Ltd (NSDL) extended their strong rally on Monday, marking a fourth consecutive session of gains since debuting on the market on August 6. The stock surged 9.59 per cent to hit a fresh high of Rs 1,425 on the BSE and was last trading 7.98 per cent higher at Rs 1,404.10. At this level, the scrip has risen 75.51 per cent from its initial public offering (IPO) price of Rs 800.

Some analysts suggest that short-term or listing-gain investors should consider booking profits after the sharp rally, while one recommends that long-term investors hold on to their positions.

"Immediate support is seen near Rs 1,350, while resistance lies at Rs 1,450," observed Jigar S Patel, Senior Manager – Technical Research Analyst at Anand Rathi. "A decisive breakout above Rs 1,450 could open the gates for an upside towards Rs 1,500. For the short term, the stock is expected to trade within the Rs 1,300–1,500 range. Traders may consider locking in profits at higher levels," he added.

"NSDL is presently in a momentum zone. Long-term investors can continue holding the stock, while those with a medium- to short-term view may consider booking some profits," said Kranthi Bathini, Director of Equity Strategy at WealthMills Securities.

The stock could hit an upside target of Rs 1,450 in the near term, noted Ravi Singh, Senior Vice-President of Retail Research at Religare Broking, adding that a stop loss should be placed at Rs 1,150 for this trade.

"Investors who entered for listing gains may consider taking profits at current levels, given the sharp rally and strong momentum," said Drumil Vithlani, Technical Research Analyst at Bonanza.

Echoing similar views, Sebi-registered independent analyst AR Ramachandran also advised booking profits at current levels.

Backed by strong fundamentals and a dominant position in the depository services space, the company garnered solid investor response during the IPO. The initial share sale was met with strong overall demand, being oversubscribed 41 times. Qualified institutional buyers (QIBs) led the charge, subscribing 104 times their allotted quota, followed by non-institutional investors (35 times) and retail investors (7.7 times).

The issue was open for bidding between July 30 and August 1. NSDL raised Rs 4,011.60 crore through a complete offer-for-sale (OFS) of 5,01,45,001 equity shares.