Security & Intelligent Services (India) Limited – Great debut but poor finish

Shares of Security & Intelligent Services (India) Limited (SIS) listed on the debut at Rs 875 at the BSE and Rs 879.80 on the NSE against an issue price of Rs 815. Unfortunately the story ended there and it was virtually a one way street thereafter and only downwards. The share touched a low of Rs 749 on the BSE and Rs 748.80 on the NSE before closing at Rs 756.70 on the BSE and Rs 757.05 on the NSE.

The company had tapped the capital markets with its simultaneous offer which consisted of a fresh issue of Rs 362.25 crs and an offer for sale of 51.2 lakh shares in a price band of Rs 805-815. The issue looked expensive and the subscription in the HNI category was poor being subscribed under 2 times.

The company had allotted 43.04 lakh shares to 18 anchor investors comprising of 30 entities. Domestic mutual funds were allotted 20.24 lakh shares which was just under half the total anchor allocation. The issue opened well and had made gains of Rs 60-64 at the discovered price. There was one bulk trade reported in all on the NSE which happened at the discovered price of Rs 879.80 for 5 lac shares. Thereafter the price after holding steady just kept on slipping. The end of the day was panic and though the stock closed around Rs 756-758 the weighted average was significantly higher at Rs 824.69 on the BSE and Rs 833.92 on the NSE.

Exchange Open High Low Close Net Change % Gain/ Loss Wt.Avg Volume Delivery Del %age
BSE 875.00 878.00 749.00 756.70 -58.30 -7.15 824.69 1319728 157330 11.92
NSE 879.80 879.80 758.00 757.05 -57.95 -7.11 833.92 8025978 2006120 25.00
Total 9345706 2163450 23.15

All in all while the listing was good without doubt the finish or the closing was indeed poor. For the records this would go down as one more issue which closed below the issue price on listing day and add to the tally of the merchant bankers on the negative side. If only pricing became more rational. Amen!

Cochin Shipyard Limited – Subscribed over 76 times

The maiden IPO from Cochin Shipyard Limited was a runaway success getting oversubscribed 76.19 times. The IPO size was 1,486 crs and garnered subscription of 1.11 lakh crs. This makes it the second highest subscription amount raised after Coal India Limited. The IPO from Coal India Limited was Rs 15,000 crs and compared to Cochin Shipyard was 1 times in size. Considering the base the subscription for Cochin Shipyard could be considered to be a block buster.

The full details of the subscription are given below.

Cochin Shipyard Subscription

Bucket Size Shares applied for Times oversubscribed
QIB 16580000 1053102210 63.52
HNI 4974000 1436847000 288.87
Retail 11606000 98737050 8.51
Employee 824000 393210 0.48
Total 33984000 2589079470 76.19

The issue received 20.75 lakh applications and created a record in terms of highest number of applications ever received so far. In the process it beat the previous best of HUDCO which had received 20.13 lakh applications. Incidentally Hudco was also a government of India offering. Looking at the participation of retail in the primary market, it’s time for the regulator to look at the bucket sizes and reallocate the same considering the retail interest and the fact that retail is mass participation and consist of just one lot.

All told excellent response for the issue which was very well priced and kudos to the ministry for pricing the share at a valuation which leaves something on the table for all. Wonder when the same wisdom will dawn on the private companies and their promoters.

Monday Factor in July 2017 gains

There were five Mondays in the month of July and call it coincidence or purely incidental markets gained on each of the five Mondays. That by itself was not a big achievement but the fact that 85% of the monthly gains on the SENSEX and 65% on the NIFTY came on these five Mondays cumulatively. Looking at it another way on 16 days cumulatively SENSEX gained a mere 15% while on five days it gained 85%. In the case of NIFTY it was 35% on 16 days and 65% on five days.

Not too sure what it is but in any month where there are five days of a particular day of the week and on which the market trades on all five they tend to become crucial and invariably they account for the bulk of the movement irrespective of whether it is a gain or a loss. Couple of year’s back it happened with Tuesdays.

The full table for the SENSEX and NIFTY is given below.

Monday Value Value Prev Friday Change % change
03rd July 31221.62 30921.61 30th June 300.01 0.96
10th July 31715.64 31360.63 07th July 355.01 1.12
17th July 32074.78 32020.75 14th July 54.03 0.17
24th July 32245.87 32028.89 21st July 216.98 0.67
31st July 32514.94 32309.88 28th July 205.06 0.63
1131.09 3.66
Gains in July
31st July 32309.88 30921.61 30th June 1388.27 4.30
Percentage gains on Monday cumulatively 0.85
Monday Value Value Prev Friday Change % change
03rd July 9615 9520.9 30th June 94.10 0.98
10th July 9771.05 9665.8 07th July 105.25 1.08
17th July 9915.95 9886.35 14th July 29.60 0.30
24th July 9966.40 9915.25 21st July 51.15 0.51
31st July 10077.10 10014.5 28th July 62.60 0.62
342.70 3.60
Gains in July
31st July 1077.1 9520.9 30th June 556.2 5.52
Percentage gains on Monday cumulatively 0.65
Subscribe to RSS Feed Follow me on Twitter!