Tega down for the third day in a row post strong debut, down 21% from high

Shares of Tega Industries continued to witness selling pressure for the third straight day, after its strong debut. The stock was trading 2 per cent lower at Rs 602.90, falling 5 per cent from its intra-day high on the BSE on Thursday. The stock of industrial machinery company slipped 21 per cent from its listing day high of Rs 767.10 on December 13, 2021. Despite of the three-day decline, the stock continues to command a 33 per cent premium to its issue price of Rs 453 per share.

Tega Industries had made a strong market debut on Monday, with the stock ended 60 per cent higher at Rs 725.50 as against its issue price on the BSE. The company is a leading manufacturer and distributor of specialized ‘critical to operate’ and recurring consumable products for the global mineral beneficiation, mining and bulk solids handling industry.

The IPO was purely offer-for-sale (OFS) based where its private equity (PE) fund exited, but the company is cash-rich. The company might perform much better going forward if this momentum continues. New investors can wait for a dip to buy, while long-term investors should hold this stock. Those who have received the allotment should keep a stop loss of 690, Parth Nyati, Founder, Tradingo said post listing of Tega.

Global manufacturing facilities, sales and operations expose Tega to the risks of doing business in foreign countries, which may adversely affect the business, financial condition and results of operations. Any failure to expand or effectively manage sales and distribution network, both in India and overseas, could have an adverse effect on the business, financial condition and results of operations, are among key concerns said HDFC Securities in IPO note.

Tega is dependent on third party logistic and support service providers for the delivery of raw materials and finished products and any disruptions in their services including transportation services or a decrease in the quality of their services may adversely affect the business, financial condition and results of operations, the brokerage firm had said.

Meanwhile, Tega had garnered Rs 186 crore from anchor investors by issuing 4.1 million equity shares at Rs 453 apiece, according to a BSE circular. BNP Paribas Arbitrage, Goldman Sachs Funds, Ashoka India Equity Investment Trust Plc, Kuber India Fund, SBI Mutual Fund (MF), ICICI Prudential MF, HDFC MF, Axis MF, Tata MF and Aditya Birla Sun Life MF are among the anchor investors.