NEW DELHI: The Zomato IPO, which opens for subscription on Wednesday, is being rated overpriced, and analysts said the best thing investors can do, if they wish to, is to invest in the mega issue only for listing gains.
Three valuation parameters: price-to-sales, EV-to-sales and recent private deals in unlisted space – compared with peers – suggest there is nothing on the table for small investors, except for listing excitement.
And then, there are historical trends that suggest a few mega IPOs could not deliver listing gains in the past despite all the excitement for one reason or the other. SBI Card, GIC Re, NIA, and ICICI Prudential Life make that list.
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