Aditya Infotech share price slips over 3% after surging 61% on listing day; are valuations justifiable?

The scrip had a dream debut on the bourses on Tuesday, August 5, 2025, as the stock ended with a premium of nearly 61% against the issue price of ₹675.

The company's stock started trading at ₹1,015, a jump of 50.37% from the issue price on the NSE. In the intraday session, it surged 63.55% to hit a high of ₹1,104. Shares of the firm later ended at ₹1,085, up 60.74%.

On the BSE, it surged 50.81% to ₹1,018 in the initial trade. The stock rallied 60.61% to close at ₹1,084.10.

Commenting on the robust listing of the stock, Sourav Choudhary, Managing Director of Raghunath Capital, said, "The CP PLUS parent, a leading player in India's electronic security space, delivered a spectacular stock market debut, listing at over ₹1,015—up 51% from its IPO price of ₹675. But after the initial euphoria, investors now turn to a more fundamental question: Is there value at current levels?"

• At the listing price, Aditya Infotech trades at a P/E multiple of around 52× FY25 projected earnings, a notable premium to peers in the hardware and surveillance equipment space. While its brand strength, wide distribution network, and government-aligned product portfolio justify a valuation premium, this leaves limited room for near-term upside, unless growth accelerates beyond forecasts.

Raghunath Capital is a SEBI-registered Alternative Investment Fund (Category III), offering specialised investment services.

Aditya Infotech posted a net profit of ₹351 crore on revenues of ₹3,112 crore in FY25, with consistent double-digit ROCE and strong operating cash flows. Analysts expect earnings to grow at a CAGR of 22–25% over the next 3 years, driven by smart city deployments, public sector demand, and continued home-security adoption.

ROCE stands for return on capital employed. It is a financial ratio that indicates how effective a company is at generating profits by using its capital.

• However, import dependency on China and potential margin compression remain key risks. Any forex volatility or policy shifts on electronics sourcing could impact profitability.

Despite these risks, many see Aditya Infotech as a structural play on India’s security-tech upcycle, with room to scale via product innovation, direct-to-retail expansion, and AI-integrated surveillance, Choudhary adds.

• Analysts note that while short-term investors may book partial profits post-listing, long-term investors may consider accumulating on dips, aligning valuations closer to sustainable earnings growth.

Aditya Infotech IPO details

The ₹1,300 crore initial public offering (IPO) of Aditya Infotech received a whopping 100.69 times subscription on the closing day of bidding on Thursday.

Last week, Aditya Infotech said it had raised over ₹582 crore from anchor investors, ahead of the IPO.

The initial share sale had a price band of ₹640-₹675 per share.

The company's IPO was a combination of a fresh issue of equity shares worth ₹500 crore and an offer for sale (OFS) of shares valued at ₹800 crore by promoters.

The company said that the proceeds from the fresh issue to the tune of ₹375 crore have been earmarked for payment of debt, while a portion will be used for general corporate purposes.

About Aditya Infotech

Aditya Infotech offers a comprehensive range of advanced video security and surveillance products, technologies and solutions for enterprise and consumer segments under the 'CP Plus' brand.

In addition, the company offers solutions and services such as fully integrated security systems and security-as-a-service directly and through its distribution network.

ICICI Securities and IIFL Capital Services were the bookrunning lead managers to the IPO.