ixigo IPO Day 2: Should You Apply? GMP Holds Steady as Subscriptions Surge 1.95x!

The IPO of ixigo, which opened on 10th June 2024, has seen strong interest from investors. The offering, valued at ₹740.10 crore, will close on 12th June 2024. The price range for ixigo shares is set between ₹88 and ₹93 each, and the shares will be listed on the BSE and NSE. The IPO consists of both new shares and an offer for sale (OFS). The OFS is worth ₹620.10 crore, while ₹120 crore is set aside for new shares. As of now, the IPO has been subscribed 1.95 times. Despite market fluctuations, the grey market premium (GMP) for ixigo shares remains stable. Today, ixigo shares in the grey market are trading at a premium of ₹24.

ixigo IPO GMP Today

The GMP for ixigo shares today is ₹24, the same as Monday. This stability in the grey market premium, even with the volatility on Dalal Street, is a positive sign for the IPO. Strong interest from primary market investors is likely helping maintain this premium despite market pressures.

ixigo IPO Subscription Status

By the end of the first day, the ixigo IPO was subscribed 1.95 times. The retail portion was subscribed 6.21 times, the Non-Institutional Investors (NII) portion 2.78 times, and the Qualified Institutional Buyers (QIB) portion 0.12 times. This strong response, especially from retail investors, suggests that the IPO may become oversubscribed, potentially leading to higher gains upon listing.

ixigo IPO Review

Mehta Equities Review:
Rajan Shinde, a Research Analyst at Mehta Equities, recommends subscribing to the ixigo IPO, noting the company’s strong revenue growth in FY2022 and FY2023 (180% and 32.1% respectively) and a turnaround in net profit. The IPO is priced at a P/E of 41.12x at the upper price band of ₹93, which seems fair given the near-term growth potential. However, the high proportion of OFS and lower founder holding might be concerns for new investors. He advises that only those willing to take on some risk should subscribe for long-term gains.

Anand Rathi Review:
Anand Rathi also recommends subscribing for the long term, citing ixigo’s strong market presence in rail bookings and its growth potential in the travel sector. The company’s valuation at P/E of 154x and market-cap/sales ratio of 7.2x after the issue compares favourably with its peers. With industry growth and ixigo’s established brand, there’s room for profitability improvement.

Canara Bank Securities Review:
Canara Bank Securities suggests a long-term subscription due to ixigo’s leading market share in the online travel segment, the shift from offline to online bookings, and the addition of new routes to increase connectivity.

Overall, ixigo’s IPO has attracted significant attention from investors, with strong subscription numbers and stable grey market premium suggesting positive market sentiment. Analysts generally recommend subscribing, particularly for long-term investors who are comfortable with some risk.