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After a lukewarm IPO, will Rustomjee realty developer's stock stage a listing gain? Here's what to expect

After a lukewarm IPO, will Rustomjee realty developer's stock stage a listing gain? Here's what to expect

After a lukewarm IPO, will Rustomjee realty developer's stock stage a listing gain? Here's what to expect
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By Sandeep Singh  Nov 17, 2022 3:48:18 PM IST (Published)

Keystone Realtors — the operator of real estate brand Rustomjee — is likely to list its shares on BSE and NSE next week. Grey market dealers expect it to be a flat-t--marginally-positive debut. Here's what you can expect on November 24.

Keystone Realtors — the property developer behind the brand Rustomjee — may make a modest debut in the secondary market on Dalal Street next week. The Mumbai-based real estate builder's IPO worth Rs 635 crore concluded on November 16 with an overall subscription of two times the shares on offer with strong participation from high-net-worth individuals. The IPO included the fresh issuance of shares worth Rs 560 crore. 

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Is there a surprise in the making on Rustomjee's listing day?
The company has failed to command a premium in the grey market — or an unofficial market for unlisted securities, say, dealers. Generally, grey market trends are mirrored on the day of listing shares on Dalal Street bourses.
"Going by the trend in the grey market, where Keystone Realtors hardly has any activity, one can expect a muted listing," Dinesh Gupta, Co-Founder of UnlistedZone — a firm that deals in unlisted shares, told CNBCTV18.com.
"The real estate sector was doing good and expected to do well in the next 2-3 years," he said.
Others expect a flat-to-marginally-positive debut for Keystone on BSE and NSE.
"Keystone Realtors has a decent asset-light business model run in the MMR region. Despite a strong brand name and business model, the response to the IPO was a bit slow as, apparently, the IPO pricing was not much lucrative," said Abhay Doshi, Co-Founder of Unlisted Arena — a portal that tracks grey markets. (Learn about what the grey market is)
The IPO of Keystone Realtors was priced at Rs 514-541 apiece under the IPO. Shares were available for bidding in multiples of 27— translating to Rs 13,878-14,607 per lot.
Meanwhile, several experts are betting on a long-term upcycle in the country's real estate sector.
The IPO of Rustomjee received bids for 1.7 crore shares against the 86.5 lakh shares on offer. Up to 50 percent of the issue was reserved for QIBs, 15 percent for non-institutional investors — also known as high net-worth individuals — and the remainder for retail investors.
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