New Delhi: GMR, the infrastructure company that is modernising the Delhi airport, made a quiet debut on the bourses. The company is saying that inspite of infrastructure being in a tough sector, it has a plan.
GMR's founding chairman, GM Rao, rang the bell to a rather lacklustre debut for his company on the stock markets.
GMR, which raised Rs 8000 crore through its IPO earlier this month, started trading at Rs 215 rupees, up just Rs five from the issue price of Rs 210.
Analysts say that the stock is only for long term investors.
Says market analyst, T S Harihar, "If you are looking at GMR to make a quick buck in short term, then this is not the company for you because this is a long term story. It's got three businesses out of which airports is one segment which will be a real cash cow and most probably it will be a slightly medium to long term haul."
The company, which has been building highways has also bagged the contracts to construct airports in Delhi and Hyderabad.
GM Rao admits that infrastructre is a difficult sector to been but the company's strategy protects it against any project delays.
"We have 12 projects in all out of which two have been given to yundai, two road projects have been given to UEM and another project has been given to L&T. This way we are derisking our construction risk and completing our projects well within the time and budget limits," says he.
But, it might take more than that to cheer up investors. Investors in some recent IPOs have suffered big losses.
Shares in GMR's rival GVK Power & Infrastructure Ltd have dropped 36 per cent to Rs 197 from their offer price price of Rs 310 in February.
Low-cost carrier Deccan Aviation Ltd. and transport services provider Allcargo Global Logistics Ltd. are also trading below their IPO prices.
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