Gig-Economy Giant Urban Company Makes Stellar Market Debut At 57% Premium

The stock listed at ₹162.25 on the NSE and ₹161 on the BSE, compared to the offer price of ₹103

Urban Company got off to a smashing start with shares listing at a 57.5% premium on the benchmark indices. The stock began trading at ₹162.25 on the NSE, compared to the initial public offering (IPO) price of ₹103 per share. It opened at ₹161 on the BSE.

At the time of writing, Urban Company’s shares are trading at ₹178.3 on the NSE and ₹177 on the BSE.

IPO Details

The public issue, worth ₹1,900 crore, opened on September 10 and closed on September 12, with allotments finalized on September 16. The IPO comprised a fresh issue of 4.58 crore equity shares aggregating ₹472 crore and an offer-for-sale (OFS) of 13.86 crore shares valued at ₹1,428 crore. The price band was fixed between ₹98 and ₹103 per share.

The investor response was robust, with the issue subscribed 103.63 times overall, making it one of the largest IPOs so far this year. The Qualified Institutional Buyers (QIB) category saw the highest demand, subscribed 140.20 times, followed by Non-Institutional Investors (NII) at 74.04 times. Retail participation was also robust, with that category booked 39.25 times.

Grey Market Premium

According to market experts, the IPO’s grey market premium (GMP) was ₹51 per share, indicating a listing price of ₹154 apiece.

Kotak Mahindra Capital, Morgan Stanley India Company, Goldman Sachs (India) Securities, and JM Financial acted as the book-running lead managers, while MUFG Intime India served as the registrar for the IPO.

Company Details

Urban Company operates a hyperlocal, multi-category marketplace for home and beauty services across India, the UAE, Saudi Arabia, and Singapore.

Led by CEO Abhiraj Singh Bhal and co-founders Varun Khaitan and Raghav Chandra, Urban Company is backed by marquee investors including Accel, Tiger Global, and Naspers.

Analyst Take

While the company enjoys strong brand equity, its valuation remains stretched at 60x P/E and 12.9x Price-to-Sales (P/S), according to SEBI-registered Financial Sarthis. One-time tax credits aided its FY25 profitability.

However, the analyst believes that Urban Company’s market leadership and growth prospects stand out even though it is highly reliant on gig workers. 

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