Dreamfolks Services' shares jump nearly 42% in stock market debut

Shares of Dreamfolks Services, a company engaged in providing airport lounge services, ended 42 per cent above its initial public offer (IPO) price during its stock market debut on Tuesday. The stock climbed as much as 69 per cent, to Rs 550 versus its issue price of Rs 326, before giving up some gains. At the last closing price, Dreamfolks’ market capitalisation stood at Rs 2,417 crore, up Rs 1,703 crore, assigned in the IPO.

The successful listing follows a strong response to the company’s maiden share sale, which had garnered nearly 57 times subscription last month. The institutional investor portion was subscribed 70 times, the wealthy investor portion by 38 times, and the retail investor portion nearly 44 times.

The company’s IPO was entirely an offer for sale by existing shareholders, worth Rs 562 crore. In January, when the company filed its draft offer document with the Securities and Exchange Board of India, it was looking to sell 21.81 million shares through the IPO, which was reduced by 20 per cent to 17.24 million shares to align with the volatile market conditions.

Dreamfolks enables credit card companies and corporates to provide access to airport services to their clients. It facilitates access to all the 54 lounges currently operational in India. Dreamfolks has a market share of over 95 per cent of all credit and debit card-based access to airport lounges in the 2021-22 financial year (FY22).

In FY22, the company reported a net profit of Rs 16.3 crore on revenues of Rs 283 crore. The firm began effective operations in 2013 by facilitating lounge access services for the consumers of Mastercard and now provides services to all the card networks operating in India.