Share “Managed” to close just about issue price
Shares of Muthoot Finance Limited listed on the BSE at a glittering Listing ceremony and began trading on the NSE on Friday the 6th of May. The day was the auspicious “Akshaya Trithiya” which is considered very lucky and thousands of people decide to get married on this day. Investors and shareholders also have a similar relationship with companies and if the beginning is good it is said that the relationship is a lasting one.
The share listed at the BSE at Rs 180 and at Rs 196 on the NSE. The high on the BSE was Rs 198 and Rs 198.90 on the NSE. The low was Rs 161.50 on the BSE and Rs 161.40 on the NSE. The share after opening positive came under pressure around 11 am and fell all the way to just under Rs 162 before there was concerted effort to move the share price and in the last forty five minutes of trade the share rallied strongly from just about Rs 165 to 180. This rally was good enough to bring the weighted average close above the issue price and save the blues for the share. It would have been a bigger disaster if the share had closed below the issue price.
| Exchange | Open | High | Low | Close | Net Change | % Gain/loss | Wt. Avg | Volume | Delivery | Del %age |
| BSE | 180.00 | 198.00 | 161.50 | 176.25 | 1.25 | 0.71 | 173.23 | 22676312 | 3334845 | 14.71 |
| NSE | 196.60 | 198.90 | 161.40 | 175.90 | 0.90 | 0.51 | 176.10 | 60613615 | 15790832 | 26.05 |
| Total | 83289927 | 19125677 | 22.96 |
What is important to note in the issue is that it received excellent response from investors and was subscribed 24.55 times. Retail investors chipped in with over eight times subscription and HNI’s who had subscribed the issue 60 times, have apparently lost their shirt at this point with a notional loss of the interest or leveraged cost which is in the region of Rs 28-30 per share.
The traded volume was 832.90 lac shares which was 1.61 times the IPO size of 515 lakh shares. The delivery volume was 191.25 lakh shares which was 22.96% of the traded volume and 37% of the IPO size. The traded volume was poorer and the delivery volume at 37% was quite poor compared to previous issues. It may be mentioned that the share under pressure without delivery happening is indicative of pressure and does not augur well for the share going forward. The weighted average of the day’s trade is 173.23 on the BSE and Rs 176.10 on the NSE.
The price chart indicates the pressure that the share saw during the day’s trade. On the institutional side no selling was reported in the bulk data on the exchanges. There was however a buy trade where Deutsche Securities Mauritius Limited bought 22,56,162 shares at R 184.77. The buying support was there but the selling pressure just seemed a bit too much. One must also remember that the markets were in a bad shape and had lost for the last nine trading sessions in a row. Coming after such a fall and on a day when the markets were on a roll right from opening moment, the performance of the share is far from satisfactory and leaves a lot to be desired.
Yet another IPO, yet another listing, and yet again overhyped issue fails to deliver. One only hopes that what happened on listing day in the case of Muthoot Finance does not continue post the lsiting day. As far as the history books are concerned this issue would go down as yet another issue which failed to deliver the expectations of investors.
