Burger King IPO Trading Day Strategy: Sell After Trading Profit or Hold for More Profit?

Burger King India’s initial public offering (IPO) of Rs 810-crore became the second most underwritten issue in this fiscal year so far. The fast-service chain company subscribed 156.65 times at the close of the public offering, receiving offers for 1,167 million equity shares compared to 7.44 million shares on offer. Seeing such strong response from all categories, analysts expect Burger King India’s stock to post price gains; Analysts also suggest adding it to the portfolio for good medium and long-term returns. “It’s definitely a good initial public offering to trade in earnings and from the medium to long term it also looks like good stocks in the portfolio. We may see a premium listing of 30% or even more, ”Vishal Wagh, research director at Bonanza Portfolio Ltd, told Financial Express Online.

Burger King India 14th IPO this year

Wagh also added that the nature of Burger King India’s business, the scope of the expansion, the positive sentiment in the market, and the availability of liquid flow in the market helped it receive the second highest subscription in the current year after for Mazagon Dock Shipbuilders. Mazagon Dock Shipbuilders’ Rs 444 crore IPO was subscribed 157.41 times and became the most widely subscribed public issue this calendar year. While Happiest Minds Technologies was the third most subscribed initial public offering so far this fiscal year with 150.98 times the request. Burger King India was the fourteenth IPO this year.

Use trading day earnings to record earnings at Burger King India

According to Abhijeet Ramachandran, Independent Analyst / Co-Founder and Trainer of Tips2Trade, the consumer and especially food businesses in India have grown at a rapid pace in recent years. “Any profit over 20% on the trading day should be used to record some profit. New investors should wait for it to go down and get into the stocks as the market in general also seems overbought, ”said Ramachandran.

Gray market premium increases 66.6%

Also on the gray market, Burger King India shares were trading at a premium of Rs 40 to the issue price of Rs 60 each. The shares were trading at Rs 100 each, which implied a premium of 66.6 per cent. The share allocation in the Burger King India IPO is likely to take place on December 9, 2020 and is expected to go public on December 14, 2020. Link Intime India Pvt Ltd is the registrar for the Burger King IPO India and will manage the allocation and reimbursement.

Ramachandran further added that lifestyle changes, urbanization and better spending capabilities have generated huge growth opportunities in the QSR segment. This, coupled with a reasonably strong brand, has generated strong demand for Burger King’s IPO.