Share closes down 13%
Tree House Education & Accessories Limited which had tapped the capital markets with its IPO which opened on the 10th of August and closed on the 12th of August, listed on Friday the 27th of August. The company had launched its IPO in a price band of Rs 135-153 and the issue was subscribed 1.85 times with retail being the largest subscriber at 2.76 times. The scrip listed at the BSE at Rs 132.80 and at Rs 132 on the NSE. The high of the day was Rs 161.50 on the BSE and NSE. The low was Rs 104.15 on the BSE and Rs 105.15 on the NSE. The stock closed at Rs 116.55 on the BSE and Rs 117.60 on the NSE with losses of around 18%.
| Exchange | Open | High | Low | Close | Net Change | % Gain/loss | Wt. Avg | Volume | Delivery | Del %age |
| BSE | 132.80 | 161.50 | 104.15 | 116.55 | -18.45 | -13.67 | 140.53 | 20169071 | 1785386 | 8.85 |
| NSE | 132.00 | 161.50 | 105.15 | 117.60 | -17.40 | -12.89 | 141.54 | 29345647 | 2513968 | 8.57 |
| Total | 49514718 | 4299354 | 8.68 |
The total traded quantity was 495.14 lac shares which was 5.87 times of the IPO size of 84,32,189 shares. The delivery quantity was 42,99,354 shares which was 8.68% of the traded volume and 50.99% of the IPO size. In institutional trade, Dhanlaxmi bank sold 4,44,954 shares and recently listed company Inventure Growth & Securities Limited sold 1,72,782 shares. The weighted average of the day’s trade was Rs 140.53 on the BSE and Rs 141.54 on the NSE.
From the price chart it can be seen that the share after opening marginally below the issue price was in an uptrend for the first two hours and made the high of the day in this up move. The stock then started drifting downwards and there was a very sharp dip at around 12 noon where the share fell from Rs 156 to Rs 141 in a span of a few minutes and recovered to Rs 156, all in a span of less than 15 minutes. The share kept on drifting downwards and touched a level of Rs 144 by 3 pm. At this time all hell broke loose and the share plummeted to touch a level below the Rs 110 mark and then in a few minutes it made the low of the day at Rs 104.15. There was a small recovery thereafter but simply not enough to undo the damage that was already done. The sharp dip in price was accompanied by a surge in volumes, indicating weakness.
The weighted average is above the issue price indicating that investors who have sold in the first few hours have made money. Secondly there was a discount of Rs 6 per share given to retail investors which made their application in the share profitable. However if anyone did not sell by 3 pm he certainly was caught on the wrong foot and has lost money. The closing price of Rs 116.55 on the BSE meant a loss of Rs 18.45 per share or 13.67%. In the case of NSE the closing price was Rs 117.60, a loss of Rs 17.40 or 12.89%.
All in all a reasonable listing holding on for the better part of the day but succumbing to selling pressure in the last couple of hours. The issue closed with losses of over 13%. It would be interesting to see whether the share is able to hold on to these levels going forward or not.
