Shares of L&T Technology Services Limited (LTTS) which had tapped the capital markets with its offer for sale of 1.04 cr shares in a price band of Rs 850-860 was hanging on by the skin of its teeth on its debut. The company hd allotted 31.20 lac shares to 19 anchor investors comprising of 33 entities. The issue was subscribed 2.53 times overall with the QIB portion subscribed 5.01 times, HNI 1.03 times and Retail 1.75 times. There were 3.10 lac application forms this time against 1.93 lacs in the previous issue of L&T Infotech.
The performance of companies launched by L&T has been far from satisfactory and this was reflected in the substantial drop in retail participation. The earliest issue of L&T Finance took a long time to make money for shareholders or investors. The issue from L&T Infotech listed in July and is yet to turn positive. Under these circumstances the discovery price of LTSS at Rs 900 on the BSR and Rs 920 on the NSE was impressive and could be considered as a price better than expected.
Probably the people involved with the issue were aware of the pressure on the stock. They were helped in no small means by the buying of 11 lakh shares by Motilal Oswal Mutual fund who bought at an average of Rs 920. There were no other bulk deals reported on either the buy or sell side.
| Exchange | Open | High | Low | Close | Net Change | % Gain/loss | Wt. Avg | Volume | Delivery | Del %age |
| BSE | 900.00 | 931.00 | 860.00 | 865.10 | 5.10 | 0.59 | 895.38 | 1929762 | 550993 | 28.55 |
| NSE | 920.00 | 931.45 | 860.10 | 869.00 | 9.00 | 1.05 | 902.50 | 8014800 | 2622573 | 32.72 |
| Total | 9944562 | 3173566 | 31.91 |
From the table above one can see that the total traded volume was 99.44 lac shares which is 96% of the issue size. If one looks at the same excluding the anchor portion of 31.20 lac shares which have a 30 day lock-in, then the traded volume is 1.37 times of the balance. The delivery volume is 31.73 lakh shares which is 31.91% of the traded volume and 30.52% of the IPO size. Based on the non-anchor portion the delivery percentage is 43.59, implying that there has been quite a significant portion delivered on day one.
The weighted average of the day’s trade was Rs 895.38 on the BSE and Rs 902.50 on the NSE. If one looks at the intra-day chart of the share, the price held itself till about 12 noon or the first two hours of trade. Thereafter is continuously fell and at the end of the day’s trade was at the issue price. This effectively meant that even without the leveraged investors from the HNI category the share cracked. It may also be looked at whatever support was provided was withdrawn.
The share is precariously poised and any fall would bring it below its issue price. Very clearly the strong brand of L&T is cracking and none except the present management team could be at fault. The investing public is no longer in a mood to accept any losses. Time for a wakeup call. Hope someone is listening.
