Urban Company shares surge 8% after SBI MF increase stake with ₹600 crore purchase

Shares of recently listed Urban Company Ltd. will be in focus on Wednesday, March 18, after SBI Mutual Fund increased its stake in the company by buying shares in the block deal that took place on Tuesday,

SBI MF purchased shares worth ₹632.2 crore in Urban Company, amounting to nearly 4% of its outstanding equity.

As of December 31, SBI MF already had a 1.89% stake in the company.

Urban Company saw a large block on Tuesday, where three entities offloaded nearly 4.6% of the company's outstanding equity.

Existing shareholders DF II Fund, and Wellington Hadley Harbor, sold their entire stake, marking an exit from the company, while ABG Capital, which had a 1.36% stake as of December, offloaded 1.2% stake or 1.74 crore shares.

The block in Urban Company took place as soon as the six-month lock-in for shareholders ended on Tuesday, which freed up 940.9 million shares of the company, or 66% of the total outstanding, according to Nuvama Alternative & Quantitative Research.

Shares of Urban Company had made their stock market debut in September last year, having priced their IPO at ₹103 apiece. The stock nearly doubled within a few days of going public, making a post-listing high of ₹201.

However, concerns over profitability and increased investments in its new Instahelp service, led to the stock reversing all of those gains, even slipping below the issue price for a brief period.

Shares of Urban Company ended 2.1% lower on Tuesday at ₹110. The stock is down 8% in the last one month.