Tatva Chitan Pharma Listing: The shares of Tatva Chintan Pharma saw a tremendous entry in the market today and almost doubled the investment of IPO investors. The shares of Tattva Chintan Pharma are trading at Rs 2111, which is almost 95 per cent higher than the IPO price of Rs 1083. At the time of its inception in the stock market, the market capital of Tattva Chintan was Rs 4680 crore. Let us tell you that there was tremendous attraction among investors regarding the IPO of Tatva Chintan Pharma and this year was the second most subscribed public issue of 2021. Its IPO was oversubscribed 180.36 times. After listing today, its prices had reached a high of 115.58 percent in the initial trade itself in comparison to the IPO price.
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Motilal Oswal gave subscribe rating
According to brokerage firm Motilal Oswal, Tattva Chintan Pharma is the second largest company in the world and only in India to manufacture SDA for zeolites (minerals used as drawing agents, dietary supplements) in the country. 40 percent of the company’s revenue comes from SDA. The special chemical segment in the country is expected to grow at a CAGR of 11.3% by the calendar year 2019-2024. Apart from this, the export of chemicals from India is also expected to grow at a CAGR of 13 per cent instead of 7 per cent from China during this period. Motilal Oswal subscribes to Tatva Chintan’s IPO due to benefits to Indian companies from China+1 strategy (Strategy to invest in other countries outside China), Tatva Chintan’s ability to capitalize on this opportunity through diversified product portfolio across multiple industries rating was given.
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These are the business problems in front of Tattva Chintan Pharma
According to Choice Broking, Tattva Chintan Pharma’s PE valuation prior to listing stood at 45.9 times EPS (earnings per share) at Rs 23.6 in FY21, against an average of 57.2x of Peer’s. Globally adverse economic environment, adverse government policies, difficulty in expanding client and product portfolio, adverse forex movements, rising raw material prices are the major problems faced by Chintan Pharma.
(Article: Kshitij Bhargava)