Quicktouch Technologies' stock soared an impressive 150% from its initial public offering (IPO) price following an announcement of warrant-to-equity share conversion. The news, released through an exchange filing, caused a significant stir in the market. This growth can be attributed to the company's decision to allot more than 3 lakh warrants into equity shares. Investors who applied for the IPO online back in May 2023 have seen significant returns on their investment.
Board approves warrant conversion
On Friday, Quicktouch Technologies announced that its board of directors had approved the conversion of 3,20,000 warrants into equity shares. The issue price was set at ₹196.17, which includes a premium of ₹186.17 per share. The warrants were issued to non-promoters under the public category on a preferential basis. The final amount raised through this conversion totals ₹4,70,80,800, with ₹147.128 per warrant (75% of the issue price) being collected.
This development has further boosted investor confidence, contributing to the sharp rise in the company’s stock price. Despite the surge, Quicktouch Technologies shares were trading around ₹160.10 during Friday’s session, marking a 1% increase around noon.
Trading momentum and market performance
Nearly 40 lakh shares of Quicktouch Technologies exchanged hands by midday, signalling strong investor interest. The stock is currently trading above its 5-day, 20-day, 50-day, and 100-day moving averages, but it remains below the 200-day average. This suggests that the stock has been gaining momentum in the short to mid-term, driven by positive news around its warrants, but there is room for improvement in its long-term performance.
Warrants, as a financial instrument, give holders the right to purchase stock at a predetermined price within a specified timeframe. In this case, Quicktouch Technologies offered a warrant price lower than its current stock price, making it an attractive opportunity for investors to convert. These warrants typically have a conversion period of 18 months, giving flexibility to those looking to exercise their rights.
Strong returns since IPO
Quicktouch Technologies, established in 2013, is a leading information technology company offering software solutions, consulting services, IT product development, and web design. The company made its market debut through an IPO in May 2023, pricing its shares at ₹61 each. Since then, it has delivered over 150% returns to investors. Those who applied for the IPO online have seen their investment appreciate substantially in a relatively short period.
The company’s solid performance can be attributed to its focus on expanding its IT services and consulting offerings. The latest move to convert warrants into equity shares demonstrates management's confidence in the company's future growth prospects, as it boosts the equity base and enhances shareholder value.
Market outlook
Quicktouch Technologies continues to be a stock to watch, especially with its warrants conversion strategy sparking renewed interest. While the stock has shown remarkable returns since its IPO, future growth may depend on broader market conditions and the company’s ability to maintain its competitive edge in the IT sector.
Investors will likely monitor further developments closely, particularly as the company moves forward with its expansion plans and capitalises on its strong market presence.
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