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The muted debut, however, did not last long. Within less than an hour of listing, the shares had climbed more than 5% from the IPO price to Rs 1,878 apiece. The rally added roughly Rs 19,290 crore to the exchange's market value, taking its market capitalization to approximately Rs 4.64 lakh crore. NSE shares finished their maiden trading session at Rs 1,817 apiece, gaining 0.94% over the listing price and 1.79% above the IPO issue price. At the close of trade, the exchange commanded a market capitalisation of Rs 4,49,707.50 crore. The early price action offered a lesson that extends well beyond NSE: an IPO story does not end when the stock lists. 1. GMP is not the sole indicator of listing performance Investors have long tracked the grey market premium (GMP) of unlisted shares as a quick gauge of sentiment ahead of an IPO. A strong GMP is generally interpreted as a sign of robust demand and is often used to estimate the premium at which a stock could list. But the recent IPO cycle has shown that the signal can change rapidly — and the actual listing can differ sharply from grey market expectations. NSE's GMP was around 10-11% on September 17, when the issue opened for subscription. By the time of listing, the premium had fallen to around 3-4%. The eventual listing premium was just 0.8%. A similar disconnect was visible in the recent debut of Hero Motors. Ahead of its September 23 listing, the stock's GMP had fallen to almost zero from around 16% on September 16 when the issue opened. Grey-market indications suggested that the stock could list close to its IPO price of Rs 84. It opened at Rs 82 on both the BSE and NSE, a discount of around 2% to the issue price. Yet the listing price was hardly the end of the story. The stock subsequently attracted strong buying interest, surging nearly 20% from its listing price and hitting the upper circuit at Rs 98.51 on the BSE. The takeaway is straightforward: GMP is a sentiment indicator, not a guarantee of listing performance or subsequent returns. ALSO READ: IPO reality check! Is GMP a useful signal or just market noise? Here’s what experts think 2. The broader market can weigh on an IPO's debut An IPO does not list in isolation. The broader market environment on the day of debut can influence investor appetite, risk-taking and price discovery. That was particularly relevant to NSE's listing on Thursday, when sentiment across the secondary market was weak. The benchmark Nifty 50 and BSE Sensex were both trading more than 1.5% lower during the session. The Nifty 50 fell 1.57% to an intraday low of 23,077.80, while the Sensex dropped 1.54% to 73,671.56. Against that backdrop, NSE's 0.8% listing premium — followed by a move above the IPO price — needs to be viewed in the context of a broader risk-off session. For investors, the lesson is that listing-day performance reflects more than company-specific factors. The market backdrop can materially influence initial price discovery. A fundamentally strong issue can therefore have a muted debut when the broader market is under pressure, while a favourable market environment can amplify investor appetite. 3. Valuations eventually catch up For an IPO investor, the more important question is not simply, "At what premium will this stock list?" but, "What is the business worth?" Pre-listing buzz can generate substantial enthusiasm around an issue. But once the company begins trading on the exchange, investors have to assess the stock against earnings, growth prospects, cash flows and the valuation of comparable businesses. In the short term, markets can be driven heavily by sentiment, positioning and investor behaviour. Over longer periods, however, the focus tends to shift towards the underlying business and its ability to deliver earnings and cash flows. 4. Always look at the fundamentals For long-term investors, the IPO price and listing-day performance are only starting points. Revenue growth, profitability, cash flows, competitive advantages, management quality, industry structure and future growth prospects ultimately determine whether a valuation can be justified. Narendra Solanki, Head, Fundamental Research - Investment Services at Anand Rathi Share and Stock Brokers, said fundamentals and the valuation at which an IPO is offered should remain the most important considerations for long-term investors when deciding whether to apply. He also pointed out that several factors can influence the premium commanded in the grey market, including the size of the IPO, demand, valuation, sector, prevailing market sentiment and promoter pedigree. That makes it important for investors to distinguish between demand for a stock and the quality and value of the underlying business. 5. A stock can rally after listing if the fundamentals support it Perhaps the most useful lesson from recent IPOs is that the listing price is not necessarily a verdict on a stock's long-term prospects. NSE's own debut illustrates the point. Despite listing with a relatively modest premium, the shares quickly moved higher, gaining more than 5% from the IPO price within an hour and taking the exchange's market capitalization to around Rs 4.64 lakh crore. Brokerages subsequently initiated coverage with bullish recommendations and target prices implying further upside. Macquarie initiated coverage with an Outperform rating and a Rs 1,965 target price, implying around 10% upside from the upper end of the IPO price band. Emkay initiated coverage with a Buy rating and a September 2027E target price of Rs 2,050, implying around 15% upside. Domestic brokerage PL Capital assigned an Accumulate rating with a target price of Rs 1,950, implying more than 9% upside from the IPO price. ALSO READ: NSE draws brokerage attention on stock market debut as 3 firms initiate coverage on Day 1 Hero Motors offers another example from the other end of the spectrum. The stock opened below its IPO price but subsequently surged nearly 20% from its listing price, hitting the upper circuit at Rs 98.51 on September 23. The common thread is that post-listing price discovery can quickly change the investment narrative. For investors, the broader lesson is not to treat the IPO price, grey-market premium or opening print as a definitive measure of a stock's prospects. Once trading begins, the market starts reassessing the business in real time — weighing valuation, earnings expectations, market conditions and future growth prospects. In that sense, the listing is not the conclusion of an IPO story. It is the beginning of a new phase of price discovery. Disclosure: This article has been written by Kumar Gaurav, who is not a SEBI-registered Research Analyst or an Investment Adviser. Gaurav and their ‘relative(s)’ (as defined under Section 2(77) of the Companies Act, 2013) do not hold any financial interest in the companies mentioned in this article as of the date of publication. The views/recommendations mentioned in this article, wherever applicable, are those of the respective SEBI-registered Research Analyst/brokerage and have been reproduced/reported with due attribution. They should not be construed as the views or recommendations of The Economic Times Digital or the journalist. Readers are advised to consider the original research report and make their investment decisions based on their own assessment. Brokerage disclaimers here (What's moving Sensex and Nifty Track latest market news, stock tips, Budget 2025, Share Market on Budget 2025 and expert advice, on ETMarkets. 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