Unicommerce eSolutions share price jumps 9% after bumper listing. Should you buy, sell or hold?

Unicommerce eSolutions stock made a remarkable debut today, listing at ₹235 per share on the NSE, a 117.59% premium over its issue price of ₹108. On the BSE, the stock debuted at ₹230, reflecting a 112.96% premium.

The stock, after the bumper listing, extended gains to reach ₹256 apiece, a notable 9% surge from its listing price of ₹235 apiece. Retail investors who were allotted shares witnessed their investments grow by nearly 136% in a day.

Please note that the recent price control cap, imposed by the NSE, limiting listing gains to 90%, applies only to SME IPOs and does not affect mainboard IPOs.

More gains ahead?

Shivani Nyati, Head of Wealth, Swastika Investmart, said, “Unicommerce eSolutions made a spectacular debut on the stock market, listing at ₹235 apiece, a staggering 117% premium over its issue price of ₹108. This blockbuster performance far exceeded pre-listing expectations, fueled by the massive oversubscription of 168.35 times and a robust grey market premium.”

Nyati noted that the company's strong market position as a leading e-commerce enablement SaaS platform, coupled with its proven track record of profitable growth, solidified investor confidence. While challenges like competitive pressures and negative cash flows remain, the initial market response highlights the immense potential of Unicommerce eSolutions in the burgeoning e-commerce ecosystem.

This exceptional listing underscores the company's strong fundamentals and growth prospects. Nyati advised investors to book profit at the current level, while those who want to hold, may keep a stop loss at ₹210 apiece.

Prashanth Tapse, Research Analyst and Sr. VP Research at Mehta Equities, added, "Despite market volatility, SoftBank-backed Unicommerce eSolutions listed beyond street expectations, bolstered by investors’ confidence following overwhelming subscription demand."

Tapse said that the strong listing is justified by Unicommerce being the largest e-commerce-enabled SaaS provider and the only profitable player in this space with no listed peers.

"We continue to believe the company merits a premium valuation multiple, as it is well-positioned to capitalize on the expanding e-commerce enablement sector. Therefore, we recommend allotted investors continue to 'HOLD' Unicommerce eSolutions shares with a long-term perspective," said Tapse.

About Unicommerce eSolutions

The company provides a comprehensive suite of software solutions designed to streamline e-commerce operations post-purchase. Their offerings include systems for warehouse and inventory management, multi-channel order management, omnichannel retail management, a seller management panel for marketplaces, logistics tracking, courier allocation, and payment reconciliation.

As of March 31, 2024, the company boasts 101 integrations with logistics partners and 11 integrations with various ERP and POS systems, facilitating seamless supply chain operations for its clients.

The company's Order Management System (OMS) has processed 791.63 million order items and supports 131 marketplace and web store integrations for automated order data flow.

Their diverse clientele spans multiple industries, including fashion, electronics, home and kitchen goods, FMCG, beauty, sports, fitness, nutrition, health, pharma, and third-party logistics. Notable clients include Lenskart, SuperBottoms, Zivame, Chumbak, Paragon, PharmEasy, XpressBees, Shiprocket, Mamaearth, Sugar Cosmetics, and Cello, as detailed in the company's DRHP report.

Since the fiscal year 2023, the company has also expanded its international presence, serving 43 enterprise clients across seven countries, mainly in Southeast Asia and the Middle East, as of March 31.

Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before taking any investment decisions.