Ujjivan Financial Services Limited which had tapped the capital markets with its simultaneous offers listed on the bourses and gained 10%. The company had raised Rs 358.16 crs by way of a fresh issue and offered 2.49 cr shares by way of secondary offering in a price band of Rs 207-210. The company allotted 1,26,07,081 shares at Rs210 to 17 anchor investors comprising of 54 entities. All the shares were allotted to domestic QIB’s as FII’s are not permitted to invest in this issue as per RBI guidelines.

The issue received excellent response and was subscribed an overall 40.68 times with the QIB portion subscribed 33.84 times, HNI a massive 135.45 times and retail 4.02 times. The leveraged HNI cost per share was between Rs 48-49 implying that he needed a price in the market of Rs 258-260 to breakeven. On the eve of listing the grey market premium was about Rs 54-58 and HNI’s were very happy that there was a killing to be made. The first shock came when shares of Thyrocare listed on Monday and paper profits evaporated and turned into losses. The second shock came when shares of Ujjivan listed on Tuesday at Rs 227 on the BSE and Rs 231.90 on the NSE. This indicated that a potential loss of Rs 28-30 per share was staring at the face of very HNI.

Traded volume on the two exchanges was 579.42 lac shares which was 1.38 times the IPO size of 420.23 lac shares. The delivery volume was 165.38 lac shares which was 28.54% of the traded volume and 39.36% of the IPO size. If one were to consider the anchor portion which has a lock-in for 30 days the delivery percentage increases to 56.22%. the weighted average was Rs 234.05 on the BSE and Rs 234.55 on the NSE, implying that all those HNI’swho applied through leverage and sold at the average have lost Rs 24-25 per share or almost 10%. Key takeaway from the issue is that money making cannot be so easy and it is difficult making money.

From the table above one can clearly see that while retail; investors made 10% HNI’s lost 10%. It’s high time the regulator realised that HNI’s being allowed to apply for one time the whole issue is causing demand disruption and benefits just the finance companies and no one else. Until this act is changed we will have a vibrant grey market which is illegal and finance companies making multiple times the money that merchant bankers make.