Aditya Infotech shares rally 8% on trading debut. What should investors do?
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Listing surpasses grey market expectations
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'After the euphoria': What should investors do?
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Company Fundamentals and Growth Outlook
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Shares of surveillance tech firm Aditya Infotech surged as much as 8% on their stock market debut on Tuesday, delivering strong gains to IPO investors and surpassing pre-listing expectations. The performance prompted market participants to weigh near-term valuation risks against the company's long-term structural potential, as analysts flagged stretched valuations and recommended selective accumulation following the listing pop.The stock opened at Rs 1,018 on the BSE, a 50.8% premium to its issue price of Rs 675, and at Rs 1,015 on NSE, reflecting a 50.4% debut gain. It rose further during the session, hitting an intraday high of Rs 1,095 on BSE and Rs 1,094 on NSE, translating to gains of around 7.6%–7.8% over the opening price.The listing performance surpassed the last grey market premium (GMP) of Rs 305, which implied an expected listing gain of around 45.2%. Aditya Infotech is now the most successful Indian IPO of 2025 by listing gain, edging past GNG Electronics, which debuted last month at a 49.8% premium.The Rs 1,300 crore IPO included a Rs 500 crore fresh issue and a Rs 800 crore offer for sale. The issue received a strong response from investors, with total subscription reaching 106.23 times, led by QIBs (140.5x), followed by non-institutional investors (75.93x) and retail investors (53.81x).Ahead of the issue, Aditya Infotech raised Rs 582.3 crore from anchor investors.'The CP PLUS parent and a leading player in India's electronic security space delivered a spectacular stock market debut, listing at over Rs 1,015—up 51% from its IPO price of Rs 675. But after the initial euphoria, investors are now asking a more fundamental question: Is there value at current levels?' said Sourav Choudhary, Managing Director at Raghunath Capital.'At the listing price, Aditya Infotech trades at a P/E multiple of ~52x FY25 projected earnings—a notable premium to peers in the hardware and surveillance equipment space. While its brand strength, wide distribution network, and government-aligned product portfolio justify a valuation premium, the current price leaves limited room for near-term upside unless growth exceeds expectations,' he added.Analysts expect the company's earnings to grow at a CAGR of 22–25% over the next three years, driven by smart city projects, public sector demand, and increasing adoption of home-security solutions.However, Choudhary cautioned that import dependence on China and the risk of margin compression remain key concerns. 'Any forex volatility or policy changes around electronics sourcing could impact profitability,' he noted.Despite these risks, Choudhary sees long-term potential in the stock. 'Many view Aditya Infotech as a structural play on India's security-tech upcycle, with room to scale through product innovation, direct-to-retail expansion, and AI-integrated surveillance solutions.''While short-term investors may look to book partial profits post-listing, long-term investors could consider accumulating on dips—particularly if the stock cools toward the Rs 940–980 range, aligning valuations more closely with sustainable earnings growth,' Choudhary advised.Aditya Infotech is India's largest provider of video surveillance equipment, operating under its flagship brand CP PLUS. It has a presence in over 550 cities, supported by a vast network of 1,000+ distributors and 2,100 system integrators. Its product lineup includes IoT-enabled home cameras, AI-driven surveillance systems, and industrial-grade security infrastructure.For FY25, the company reported a net profit of Rs 351 crore on revenue of Rs 3,123 crore, reflecting a 205% year-on-year surge in profit. IPO proceeds are earmarked for Rs 375 crore in debt repayment, with the rest allocated to general corporate purposes.Also read | Aditya Infotech shares soar 51% on debut, biggest IPO listing gain of 2025
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