| Name | Date of Listing | Issue Price | closing price | closing price | % gain loss | change over |
| 5th August | 29th July | over week | lssue price | |||
| Birla Pacific Medspa | 7thJuly | 10.00 | 18.60 | 19.70 | -5.58 | 86.00 |
| Rushil Décor | 7thJuly | 72.00 | 107.65 | 135.15 | -20.35 | 49.51 |
| Readymade Steel India | 13th July | 108.00 | 38.65 | 41.35 | -6.53 | -64.21 |
| Bhartiya Global Infomedia | 28th July | 82.00 | 18.65 | 28.35 | -34.22 | -77.26 |
| Inventure Growth & Securities | 4th August | 117.00 | 170.90 | N A | 46.07 | 46.07 |
Performance of Newly Listed Shares as on 5th August 2011
August 6th, 2011
No Comments
Inventure Growth & Securities IPO: Huge volatility on listing day
August 5th, 2011
No Comments
Share closes with gains of 77%
Inventure growth & Securities Limited listed on the BSE and NSE and ended the day with spectacular gains closing at Rs 207.95 on the BSE and Rs 206.75 on the NSE against an issue price of Rs 117.
The company chose to have a listing ceremony but did not deem it fit to have an analyst meet or a road show when it went public. The very idea behind this move seems something which is not in the interest of investors and this fact should be noted by all.
The share opened at Rs 119 on the BSE and Rs 117 on the NSE. The high was Rs 225 on both exchanges. The low was Rs 91.55 on the BSE and Rs 91.20 on the NSE. What is important to note that the share has seen unprecedented volatility and almost all the action has come in a mere 30-40 minutes when a share trading around the low shot to the high.
The company had tapped the capital markets with its IPO in a price band of Rs 100-117 for 70 lac shares. The issue was open between the 20th and 22nd of July and was subscribed 4.58 times mainly by the HNI’s and retail investors. The QIB portion remained undersubscribed with bids for a mere 25% of the category received. This was expected because the shares were offered on a ridiculously high P.E. multiple of just under 40 times at the upper end of the price band on a fully diluted basis, against the large established players like MotilalOswal and Edeleweiss available at roughly 1/4th valuations.
| Exchange | Open | High | Low | Close | Net Change | % Gain/loss | Wt. Avg | Volume | Delivery | Del %age |
| BSE | 119.00 | 225.00 | 91.55 | 207.95 | 90.95 | 77.74 | 134.18 | 47066110 | 3036164 | 6.45 |
| NSE | 117.00 | 225.00 | 91.20 | 206.75 | 89.75 | 76.71 | 131.46 | 58767922 | 3211247 | 5.46 |
| Total | 105834032 | 6247411 | 5.90 |
From the table above one can observe that the combined traded volume was 10.58 cr shares against an issue size of 70 lakh shares. This means that the IPO size was traded 15.12 times on day one. The combined delivery was 62.47 lakh shares which was 5.9% of the traded volume and a staggering 89.25% of the IPO size. If one considers the fact that 7 lac shares were allotted to a single FII, Credo Thematic Fund whose name does not appear in the bulk deals either on the BSE or the NSE, the delivery percentage becomes almost complete at 100%. The weighted average of the day was Rs 134.18 on the BSE and Rs 131.46 on the NSE significantly lower than the weighted average close of Rs 207.95 on the BSE and Rs 206.75 on the NSE. This indicates the substantial price movement which has happened in the last session of the day led by furious short covering.
Let us see the price chart movement intraday. The share opened at Rs 119 and made a high of Rs 124 and slipped into the negative in next to no time. So embarrassing was the price movement that guests were still applauding various intermediaries and associates who had helped in making the issue a success and the share price had slipped into the negative and was trading around the Rs 105 level. The share remained range bound till 12 noon and then made an upward move to Rs 125. Between 1 pm and 1.30 pm, the share with huge volume crashed to below the 100 mark and made the day’s low of Rs 91.55 on the BSE and Rs 91.20 on the NSE. What happened thereafter is unheard of and appears to be a concerted effort to catch short sellers, and manipulate the share price to unheard of levels. From a level of sub Rs 100 around 2.30 pm, the stock rose on huge buying by all concerned to a record high of Rs 225 by 3.pm. This is a concerted effort and appears to have been done in a “synchronised” manner. The share closed off the high but ended with significant gains for the day.
There is an excerpt of the half hourly trade with open, high, low close, volume traded, weighted average of the scrip on NSE.
| Time | Open | High | Low | Close | Volume | Avg Traded Price |
| 3:30:00 PM | 192.4 | 225 | 192.1 | 201.5 | 5178008 | 206.74 |
| 3:00:00 PM | 104.4 | 203 | 103.5 | 192.4 | 12974775 | 156.28 |
| 2:30:00 PM | 101.5 | 106.4 | 91.2 | 104.4 | 4064588 | 98.35 |
| 2:00:00 PM | 112 | 112.4 | 93.65 | 101.5 | 5120711 | 100.75 |
| 1:30:00 PM | 121.35 | 123.7 | 111.6 | 112 | 4034817 | 119.27 |
From the above chart it is very clear that the price was first hammered down between 1.30 pm and 2.30 pm and then there was a very sharp rise thereafter from the half hour of 2.30 pm to the end of the day. The total traded volume on NSE was 587.68 lacs which means that the half hourly average would be roughly 45.20 lac shares every half hour. Between 2.30 and 3.00 pm the volume is a staggering 129.75 lakh shares which speaks itself.
The share has had a spectacular listing no doubt but not sure how many people have made money. I believe looking at the fundamentals, the business and the future prospects of the broking business one should avoid this share. The circumstances of the listing day make this a fit case for investigation by the regulators and one hopes some action is taken. Incidentally the P.E. of the share at yesterday’s closing price is just around 70 times based on March 11 numbers on a fully diluted basis.
Related Posts:
Walt Disney plans to delist UTV Software Communications: Floor price and ceiling price confusion
August 1st, 2011
No Comments
Walt Disney Corporation who is the majority shareholder plans to acquire the shares and delist the company from the Stock exchanges where it is listed. The share has been rising steadily and the price has risen sharply from a level of Rs 386 on the 10th of February to a high of Rs 1050 on the 26th of July and a close of Rs 962.15. All this has happened when the benchmark indices have remained fairly flat. The corresponding level for the BSESENSEX on the 10th of February was 17,463.04 points which has moved up and closed at 18,197.20 points, a gain of a mere 4.20%. The scrip UTV Soft in the similar period has gained Rs 576.15 or a staggering 149.26%.
Walt Disney has informed the company and the company has informed the stock exchange of the decision to delist the company and the said notice is attached. Click here to read the notice to the stock Exchanges.
The delisting norms in India are very clear and a company has to make an offer with a floor price which is based on the weighted average of 2 weeks and 26 weeks and this becomes the minimum price to be offered for delisting. The delisting norms stipulate that the company will undertake a reverse book building and the discovered price may or may not be accepted by the company.
It appears that Walt Disney and its advisors believe that the floor price and ceiling price are the same. The company has mentioned in the letter to the exchanges under point 4 (iii) a commitment by the acquirer that the acquirer will acquire equity shares of the company at a price of Rs 1000 (Rupees one thousand only) per equity share despite the discovered price being less than Rs 1000 (Rupees One Thousand Only) per share; or and under point 4 (iv) a restriction on the board of directors of the Acquirer to subsequently approve an acquisition of shares from the public shareholders at a price in excess of Rs 1000 (Rupees one thousand only ) per equity share.
The important point to be noted is that Walt Disney is offering not only a floor price but also a ceiling price and implying that this is a price at which it will acquire any number of shares like is done in the case of an open offer. The whole deal looks again the interest of minority shareholders and SEBI the regulator should ask the company to explain its stand at the earliest.
Reverse book building implies that once the price is discovered, it is upto the company/acquirer to accept or reject the discovered price and at hat discovered price he has to accept all shares which have been tendered at or lower than that price at the discovered price. The acquirer also has to keep the discovered price open thereafter for all shareholders who have not tendered their shares.
Walt Disney appears to be circumventing the law by mixing an open offer with delisting and confusing minority shareholders. One hopes the regulator SEBI will step in and address the issue at the earliest.
