Is this the right time to exit from Ventia Services Group Limited?

Company Overview

Ventia Services Group Limited  (ASX: VNT) is one of the largest providers of infrastructure services in Australia & New Zealand. The Company was founded in 2015. The Company provides minor capital works, operations and maintenance, asset management and facilities management.

Initial Public Offering

The company had launched its IPO on November 03, 2021, under the ticker VNT at AU$1.70 each. We had covered this IPO in our ‘Kalkine IPO Report’ on November 03, 2021 and concluded that this IPO was “Attractive” given its superior earnings quality, strong balance sheet, and operating in a rapidly growing market backed by several growth catalysts for demand drivers.

Hourly Price Chart (as on December 1, 2021). Source: REFINITIV, Analysis by Kalkine Group 

Conclusion

Investors who have invested into this IPO can consider ‘Exiting’ from their position at the closing price of AU$2.05 as on December 1, 2021, given:

• Decent gains: The stock has moved up ~21% from its IPO price of AU$1.70/share and has given a decent return in a shorter time duration.
• Resurgence of COVID-19 cases: Increasing COVID-19 cases in Europe and other parts of the world is throwing a lot of uncertainties in the global financial markets. Also, real estate business could witness labour shortage, slowdown in project rollout and supply chain related problem in the near-term.
• Inflationary pressure: The sharp rise in the basic material prices (steel, copper, aluminum, lumber) could suppress margin profile of the company in the upcoming quarters.

*The reference data in this report has been partly sourced from Refinitiv.

Disclaimer

Kalkine New Zealand Limited is authorised to provide general advice only. The information on this website does not take into account any of your investment objectives, financial situation or needs. Before you make a decision about whether to acquire a financial product, you should obtain the Product Disclosure Statement from the product issuer. You should consider the appropriateness of advice taking into account your own objectives, financial situation and needs and seek independent financial advice before making any financial decisions.