Mobikwik IPO Subscribed Over 5 Times on Day 1: Should You Consider Investing?

The initial public offering (IPO) of fintech firm One Mobikwik Systems made its market debut today, December 11. The bidding for Mobikwik IPO opened for subscription today and will end on Friday, December 13. Mobikwik IPO price band has been set at Rs 265 to Rs 279 per share.

The company aims to raise Rs 572 crore from the issue at the upper end of the price band. Mobikwik IPO is entirely a fresh issue of 2.05 crore shares. Investors can bid for a minimum of 53 shares and in multiples thereof. Accordingly, retail investors would require a minimum of Rs 14,787 to bid for one lot or 53 shares of the Mobikwik IPO. For a maximum bid of under Rs 2,00,000, retail investors can apply for up to 13 lots or 689 shares.

Following the closure of bidding, the basis of allotment is Mobikwik IPO shares are expected to be finalised on Monday, December 16, 2024. Successful allottees will get the shares credited to their demat accounts by Tuesday, December 17. The company is expected to list on the exchanges on Wednesday, December 18.

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Mobikwik IPO GMP

Mobikwik shares are buzzing in the grey market ahead of the listing. The latest Mobikwik IPO GMP (grey market price) is Rs 136 on December 11, according to Investorgain.com. With the current GMP, the stock is expected to list at Rs 415, up 48.75 per cent from the price band of Rs 279.

Mobikwik IPO Subscription Rate

Mobikwik IPO has been subscribed 5.31 times till 3:12 PM on Wednesday, the first day of the bidding process, as per NSE data. The issue so far has been booked 21.18 times by retail investors and 5.36 times by non-institutional investors (NIIs).

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Should you consider applying for the Mobikwik IPO?

Anand Rathi Research, in its research note, has recommended subscribing to the IPO with a long-term perspective, citing rich valuations. At the upper band, the company is valued at 15.5x its FY24 earnings. Following the issuance of equity shares, the company's market capitalization stands at Rs 21,674.5 million, with a market cap-to-sales ratio of 2.4 based on its FY24 earnings.

The company is preparing to introduce additional services, such as investments and insurance, to establish itself as a comprehensive digital platform for financial services, which is expected to boost its future revenue and profits. However, it reported losses for Q1 FY25 due to pre-funding cost adjustment provisions.

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Analysts at Swastika Investmart have recommended subscribing to the issue only for high-risk investors. It said that the digital payment platform catering to customers and merchants has demonstrated consistent revenue growth and recently turned profitable after prior losses.  “The company operates in a highly competitive fintech landscape, which may impact future growth and market share. The IPO is priced at a high valuation,” the brokerage stated.