IPO Review: NTPC Green Energy IPO versus Enviro Infra Engineers IPO. Which one should you subscribe? | Stock Market News

IPO Review: The ongoing buzz around IPOs continues to resonate despite some signs of fatigue, as both domestic and global factors play into the mix. Deven Choksey, managing director at DRChoksey FinServ Pvt, recently pointed out that foreign investors are keenly eyeing new offerings, drawn in by the potential for quicker returns. In contrast, the selling seen in the secondary market can largely be attributed to high valuations, making some investors wary. It’s a fascinating landscape as the market navigates these dynamics!

Regarding the two initial public offerings (IPOs), NTPC Green Energy IPO and Enviro Infra Engineers IPO, retail investors are responding positively. However, the trend has shifted from previous months when issues would typically be fully booked on the first day. Now, retail investors are approaching these offerings more cautiously, yet the overall response remains decent.

Today, on the last day of bidding, the NTPC Green Energy IPO has been fully subscribed. Meanwhile, the Enviro Infra Engineers IPO, which opened today, is also receiving a good response and is likely to reach full subscription soon.

The NTPC Green Energy IPO, which amounts to ₹10,000 crore, consists entirely of new equity shares with no offer-for-sale (OFS) component. The price band for the shares is set between ₹102 and ₹108 each.

The proceeds from this IPO, totaling ₹7,500 crore, will be used to repay or prepay some or all of the outstanding loans of its subsidiary, NTPC Renewable Energy Ltd (NREL). The remaining funds will be allocated for general corporate purposes.

On the other hand, Enviro Infra Engineers IPO of ₹650 crore is priced between ₹140 and ₹148 each. The city-based company’s proposed IPO consists of a fresh issuance of 3.87 crore equity shares, alongside an OFS component that includes 52.68 lakh shares being sold by the promoters.

Investors who are considering the two options should review the experts’ opinions and then proceed with their applications accordingly.

Here’s what experts say

Arun Kejriwal, the founder of Kejriwal Research and Investment Services

Arun Kejriwal, the founder of Kejriwal Research and Investment Services, emphasized that we cannot compare the two businesses. One company focuses on renewable energy, creating, owning, and using assets to generate electricity. The other is a contractor that primarily provides EPC (Engineering, Procurement, and Construction) services for drinking water, sewage, and public-private partnership projects. Given the fundamental differences in their operations, comparing these two businesses is not valid.

Secondly, prima facie, NTPC Green Energy IPO valuations are expensive, considering other companies in a similar field. So, one should not apply for listing gains at all. Even if one has a long-term perspective on the share, waiting for the share to list before deciding to enter is likely to get it cheaper than the issue price. So again, this is a very clear-cut view of what to do with the shares.

For the other share, you can apply for listing gains, and if you get shares allotted, you can continue to hold even if you are taking a medium—to long-term approach.

Prashanth Tapse, Research Analyst, Senior Vice President of Research at Mehta Equities

According to Prashanth Tapse, on a prima facie, Enviro Infra Engineers’ IPO looks good based on valuation and sector demand. NTPC Green Energy’s IPO holds good for very long term, like 5-10 years, but IPO valuations are a bit expensive.

Disclaimer: The views and recommendations above are those of individual analysts, experts and broking companies, not of Mint. We advise investors to check with certified experts before making any investment decision.