Urban Enviro Waste Management SME-IPO lists at 41% premium, gains further

Urban Enviro Waste Management IPO had a strong listing on 22nd June 2023, listing at a sharp premium of 41%, but subsequently bounced and closed much above the listing price at the close of trading. This is despite the markets coming under pressure as the Nifty again faced resistance at the 18,800 levels and closed below that. However, the stock of Urban Enviro Waste Management Ltd managed to hold on and closed with smart gains for the listing day. For now, the headwinds like the inversion of the yield curve, the negative news flows on banks and the SVB Financial crisis are the major talking points and continue to keep the markets under pressure at higher levels. To add to that, there were also domestic valuation related concerns. Despite these factors, the stock of Urban Enviro Waste Management Ltd managed to hold on for the day quite strong.

The stock of Urban Enviro Waste Management Ltd did show a lot of strength during the day, and closed above the listing price as well as the issue price on the first day of trading on the NSE. Being an NSE SME IPO, it is only traded on the SME segment of NSE. Urban Enviro Waste Management Ltd opened 41% higher and the opening price turned out to be the low price for the day. With subscription of 220.65X for the retail portion and 281.41X for the HNI / NII portion; the overall subscription was quite healthy at 255.49X. The subscription numbers were so strong that it allowed the stock to list at a huge premium and then sustain the premium post listing, despite weak sentiments in the market overall. The table below captures the gist of the oversubscription of the issue of Urban Enviro Waste Management Ltd across various investor categories.

The SME IPO of Urban Enviro Waste Management Ltd was priced at ₹100 via fixed price format. On 22nd June 2023, the stock of Urban Enviro Waste Management Ltd listed on the NSE at a price of ₹141, a premium of 41% on the IPO issue price of ₹100. However, the stock gained from the opening levels and it closed the day at a price of ₹148.05, which is 48.05% above the IPO price and 5% above the listing price of the stock on the first day of listing. In a nutshell, the stock of Urban Enviro Waste Management Ltd had closed the day exactly at the upper circuit price for the stock of 5% with only buyers and no sellers. The upper circuit price on listing day is calculated at 5% on the listing price and not on the IPO price. The opening price actually turned out to be the low price of the day.

On Day-1 of listing i.e., on 22nd June 2023, Urban Enviro Waste Management Ltd touched a high of ₹48.05 on the NSE and a low of ₹141 per share. The opening price turned out to be the low point for the day while the stock closed at the high point of the day. Incidentally, the closing price also represented the 5% upper circuit price of the stock for the day, which is the maximum that the SME IPO stock is allowed to move in the day. What is truly appreciable is that the stock closed strong despite the overall Nifty falling by 86 points on 22nd June 2023 and dipping below the psychological level of 18,800 on a closing basis for the listing day. The stock closed at the 5% upper circuit with 10,800 buy quantity and no sellers. For the SME IPOs, 5% is the upper limit over the listing price on the day of listing.

Let us now turn to the volumes of the stock on the NSE. On Day-1 of listing, the Urban Enviro Waste Management Ltd stock traded a total of 8,00,400 shares on NSE SME segment amounting to value of ₹1,156.74 lakhs on the first day. The order book during the day showed a lot of buying with the buy orders consistently exceeding the sell orders at any point of time. That also helped the stock to close at the upper end of the circuit filter. It must be noted here that Urban Enviro Waste Management Ltd is in the trade to trade (T2T) segment so only delivery trades are possible on the stock. Hence the entire volume for the day purely represents the delivery volumes.

At the close of Day-1 of listing, Urban Enviro Waste Management Ltd had a market capitalization of ₹64.11 crore with free-float market cap of ₹26.25 crore. It has a total of 43.30 lakh shares as the issued capital of the company. As stated earlier, since the trading is on the T2T segment, the entire volume of 800.40 lakh shares during the day is accounted for only by delivery trades.

Urban Enviro Waste Management Ltd, is an SME IPO on the NSE which had opened for subscription on 12th June 2023 and closed for subscription on 14th June 2023. The company was incorporated in 2011, and it currently provides waste management solutions & municipal solid waste (MSW) management services. Its service palate includes solid waste collection, transportation, segregation, processing, and disposal services across the states of Gujarat, Rajasthan, Madhya Pradesh, and Maharashtra. It directly caters to the respective municipalities.

Apart from municipalities, Urban Enviro Waste Management Ltd also caters to local bodies; apart from providing direct waste management services to residential localities, institutions, hospitals, cantonment boards etc. Till date, the company has undertaken more than 24 projects of which 21 are ongoing projects. Some of its notable projects are under execution for Jaipur Nagar Nigam, Ankleshwar, NEERI, MIHAN India Ltd, NHDC Limited, Indira Sagar Power Station and many more.

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