Shares of Equitas Small Finance Bank Limited (ESFB) listed on the bouses and had a struggling listing. The company had tapped the capital markets with its fresh issue of Rs 280 crs and an offer for sale of 7.2 cr shares in a price band of Rs 32-33.

The discovered price was Rs 31 on BSE and Rs 31.10 on NSE with 5.37 lac shares changing hands at the pre-open. The high of the day was Rs 33.05 on BSE and Rs 33.15 on NSE. The lows were Rs 30.10 and Rs 30.05 on the two exchanges. The close was Rs 32.75, a loss of Rs 0.25 or 0.76% while it was Rs 32.80, a loss of Rs 0.20 or 0.61% on NSE. The traded volume was 268.20 lacs on the two exchanges combined. It was 17% of the issue size of 1568.48 lacs and 23% of the non-anchor book of 1145.21 lac shares. Delivery volume was 88.88 lac shares which was 33.14% of the traded volume. It was 5.67% of the issue size and 7.76% of the non-anchor book. Weighted average of the days trade was Rs 31.68 on BSE and Rs 31.67 on NSE.

The company had earlier allotted 4,23,27,271 equity shares to 14 anchor investors comprising of 35 entities. The highest allocation was an identical 37,87,650 equity shares or 8.95% of the allocation to 8 entities. These included names such as ICICI Prudential, ICICI Prudential Life Insurance, SBI Life Insurance, Franklin India and Mirae Asset Management. The issue saw QIB portion subscribed 3.91 times, HNI portion remained undersubscribed at 0.22 times, Retail portion was subscribed 2.08 times. The shareholder reservation quota was undersubscribed at 0.42 times. Employee quota was subscribed 1.84 times.

The issue just about scraped through and the response was overall poor and lacklustre. The retail category which saw about 1.69 lac applications was on the hope and expectation that there would be some listing gains on day one.

All in all, the listing day saw the share manage to hold on around its issue price. The fact that there is no undue pressure of the leveraged HNI who has losses on account of interest cost, the share would consolidate at or around the issue price. The share would move in a broad range of Rs 31-34 in the near term and the issue size needs to get absorbed.

There is a hangover on account of dilution which needs to be done in the next three years from the current 80-81% to 40%. How and when this would happen would be the discussion and clues that the market would look for. Nothing of any great significance in the share likely to happen in the near term.

Markets were under pressure last week and lost on four of the five trading sessions. BSESESENSEX lost 1,071.43 points or 2.63% to close at 39,614.07 points. NIFTY lost 287.95 points or 2.41% to close at 11,642.40 points. The broader market saw BSE100, BSE200 and BSE500 lose 2.27%, 2.11% and 2.09% respectively. BSEMIDCAP was down 0.48% while BSESMALLCAP lost 1.63%. Intra-day volatility had increased significantly on expected lines. A case in point is on Friday the 30th of October which was the first trading day of the new November series which saw an intra-day movement of 747 points while the net loss for the day was a mere 135 points.

The Indian Rupee lost 48 paisa or 0.65% to close at Rs 74.10 to the US Dollar. Dow Jones was under tremendous pressure and lost a whopping 1,833.97 points or 6.47% to close at 26,501.60 points. Dow had losses of 650 points, 222 points, 943 points, a gain of 139 points and a loss of 158 points on the five trading sessions last week.

US elections will be held on Tuesday the 3rd of November and there is a distinct possibility that we may not have a potential winner or new US President till nine days after. If no presidential nominee gets past 270 electoral votes, then we would have to wait for the counting from two states, Pennsylvania and North Carolina where the supreme court has allowed postal ballots to be counted till nine days after the election date, provided they bear the postal mark of election date or earlier. This could mean that the election outcome could get delayed and cause huge uncertainty for a prolonged period of time. The two states have 20 and 15 votes respectively.

There seems to be complete confusion on the likely outcome of the US elections and people are pointing to all sorts of combinations and permutations. In the 2016 elections where Hilary had won on the popular vote garnering about 3 million more votes than Trump, she lost on the electoral votes. This time around again a similar possibility exists. Further there is confusion about the poll forecast where all sorts of theories are being propounded about the veracity of the pollsters and their accuracy. The fact of the matter remains that with the elections likely to be a close affair and in case it goes down to the wire with no one past the 270 mark on Wednesday morning in the United States, we would see great uncertainty in Dow Jones and therefore global markets. In case we have a winner, markets would settle down in a short period of time. In either case volatility and actually heightened volatility would be the order of the day.

October futures expired on a weak note and registered losses in the final week. As mentioned last week that one has not seen four-digit gains on NIFTY in expiry, the same did happen. NIFTY expired with gains of 865.25 points or 8.01% to close at 11,670.80 points. Readers would recall that we had begun the expiry week with gains of 1,124.80 points.

On the covid-19 front the world saw 4,68,10,375 patients with 12,05,206 deaths and 3,37,54,231 patients having recovered. In India we have had 82,29,322 patients with 1,22,642 deaths and 75,42,905 people having recovered. Compared to the previous week, the world saw 34,64,431 new patients, 46,113 deaths and 17,89,340 people recovering. In India the week saw 3,19,363 new patients, 3,612 deaths and 4,05,677 patients recovering. The recovery rate is far lower than the number of new patients globally, and this is probably hinting at a second round of virus outbreak in a number of countries.

The week ahead would be volatile without doubt with US elections as close as can be. It may be out of place to try and predict the outcome of a subject where I am certainly not an authority. It would be better to share some thoughts on ground reality instead. The automobile sector has been through a lot of pain in recent quarters but seems to have recovered from the pain. Demand for 2 wheelers and entry level cars has increased significantly as people get back to work after the extended lockdown on account of covid-19. With transportation difficult and risk of covid-19 existing, more and more people are opting to have transport of their own. This has created demand from a new segment of society and this would help the industry for a minimum of two to three quarters going forward. This augurs well for industry and would help in reviving the economy as well. As an interesting sidenote, real estate sales in Mumbai seem to have picked up and sales in October were significantly higher than a year ago number as well as that recorded in January 2020. This takes into account the festival sales that are witnessed in this period. October 2020 sales were at 7,929 units against 5,811 a year ago and 6,150 units in January 2020. Considering the fact that GST collection has already crossed the 95,000 cr level, economic activity seems to have almost recovered lost ground. Part of this could be led by the lower stamp duty and GST on realty in the state of Maharashtra. Results from the banking sector are a further proof to the changing scenario.

In conclusion, it makes sense to buy on sharp dips and sell on rallies till there is clarity on the presidential election.