Closes 30% down at Rs 48
Shilpi Cable Technologies Limited listed at the BSE and NSE yesterday. The company also chose to have a listing ceremony at the BSE where the share opened at Rs 78.35. On the NSE the opening price was Rs 78. The high was Rs 84.65 on the BSE and Rs 84.70 on the NSE. The high of the day was made in the opening minutes of trade. The low was Rs 45.45 on the BSE and Rs 45.40 on the NSE. The low was made around 1.30 pm. The shares were issued at Rs 69 and the issue was subscribed 3.48 times.
| Exchange | Open | High | Low | Close | Net Change | % gain | Wt Avg | Volume | Delivery | Del % age |
| BSE | 78.35 | 84.65 | 45.45 | 47.60 | -21.40 | -31.01 | 61.63 | 38498254 | 3354713 | 8.71 |
| NSE | 78.00 | 84.70 | 45.40 | 48.05 | -20.95 | -30.36 | 61.98 | 51820648 | 4820715 | 9.30 |
| Total | 90318902 | 8175428 | 9.05 | |||||||
There is a new trend emerging in the capital markets where small companies looking to tap the capital markets choose not to have any road shows or marketing meet in the financial capital of India, Mumbai. The logic behind avoiding the road show is simply to avoid questions being asked by potential investors. The company and the merchant bankers choose this simple way of avoiding tough questions. In the interest of investors and to safeguard investors, the regulators whether they are the Stock Exchanges or SEBI, must make it mandatory for companies going public to have road shows for their IPO’s. If a company plans to go public why does it not want to meet investors and inform about their plans. Shilpi Cable Technologies was one such company which chose not to have any road show in Mumbai and the stock performance on listing day is adequate proof of why they chose to do so.
Coming to the actual performance of the share, it could at best be described as a disaster on listing day. Shares which were issued at Rs 69 closed at Rs 47.60 and Rs 48.05, a loss of Rs 21.40 and Rs 20.95 respectively. In percentage terms the loss was 31.01% and 30.36%. If one were to look at the traded volume it was a staggering 903.18 lac shares which is 10.5 times the IPO size of 85.96 lac shares. The weighted average of the day’s trade is 61.63 and Rs 61.98 respectively.
From the chart it is clearly visible that the share had only downhill movements and some sideways movement. The delivery volume was a staggering 81.75 lakh shares which was 9.05% of the traded volume but a staggering and unprecedented 95.10% of the IPO size. I am not sure who bought the shares but it appears almost everybody who bought it has sold the shares.
At the end of the day, one more IPO from a small cap and unheard of company bites the dust on the very first day of listing and cheats hundreds and thousands of investors. I believe it is time investors learnt their lesson.
