This has been the time when Indian equity indices have seen sharp corrections and greater volatility. However, Initial Public Offerings (IPOs) of Gujarat-based companies outperformed key stocks in 2021 in posting robust growth. Vadodara-based Tatva Chintan Pharma’s stock delivered 103% returns against its issue price, whereas Adani Wilmar Limited reported 170% growth. Similarly, Rolex Rings grew by 62% and Ami Organics by 43%, among others. Interestingly, Gujarat companies’ stocks also outperformed India’s most sought-after IPO of the Life Insurance Corporation of India (LIC).
Analysts believe that most of the IPOs that came after Covid have strong financials and good prospects. Ravi Diyora, research head of a stock broking firm, said, “Most of the Gujarat-based companies which got listed in the last year and a half have performed better than high profile company IPOs from other parts of India. The majority of these companies are specialty chemicals manufacturers, as the sector has seen momentum in recent times. Despite the market correction, though most Gujarat-based new listed companies have also fallen from their peaks, their returns remain positive. ”
The Indian stock market has been under selling pressure since October 2021, with high inflation and hiked interest rates along with the impact of the Russia-Ukraine war. However, sectors such as energy, oil and gas have seen momentum because of higher prices.
Gunjan Choksi, director of an Ahmedabad-based stock broking firm, said, “After Covid, MNCs reduced their dependence on China and Indian companies focused on increasing exports. Most players reported better numbers for this financial year and anticipated strong domestic demand and export support. Specialty chemical companies outperformed the market and created an alpha portfolio. Even if valuation concerns remain, the sector looks promising. ”
