Shares of ICICI Prudential Life Insurance Company Limited (ICICI Pru) listed on the bourses and did badly. Blame it on the surgical strike, yet the performance was well below the mark and far from satisfactory.
The company had through an offer for sale sold 18.13 cr shares in a price band of Rs 300-334. The issue received excellent support and was subscribed 10.48 times. The QIB portion was subscribed 11.83 times, HNI 28.55 times, Retail 1.42 and Shareholders preferential bucket 12.20 times. This portion too was dominated by HNI’s who leveraged and applied here. Going forward in large offerings there must be a split in such bucket between HNI and retail as it is unfair to get proportional allotment when one is compared with HNI’s who are borrowing and applying. Imagine an application of Rs 200 crs compared with someone who has applied for Rs 50,000 and both get proportional. Defeats the very purpose and is most unfair.
The overall issue size was just over Rs 6,000 crs and was the largest issue since Coal India in 2010. History says that whenever there is a large issue of this kind, the listing of the issue makes a market top. Whether what we saw on Thursday was yet another instance or not only time will tell. The previous instances were Reliance Petroleum in 2006, Reliance Power in 2008 and Coal India in 2010.
The company had allotted to 38 anchor investors comprising of 69 entities a total of 4.89 cr shares. The market cap at the top end of the price band at issue price of Rs 334 was Rs 47,940 crs.
The share listed at Rs 329 on the BSE and Rs 330 on the NSE. The high was an identical Rs 333.90 on both the exchanges. This price was just below the issue price of Rs 334 and the issue price is yet to to be touched on the bourses. The share slid under pressure after the news conference of the army and made a low of Rs 295.50 and Rs 295.15 on the two exchanges. The closing price was Rs 297.65 on the BSE, a loss of Rs 36.35 or 10.88%. The closing price on NSE was Rs 297.55, a loss of Rs 36.45 or 10.91%.

The total traded volume on the exchanges was 1017.77 lakhs which was 56% of the IPO size and 77% of the non-anchor issue. Delivery volume was 403.83 lac shares which was 39.68% of the traded volume and 22.27% of the issue size. Considering non anchor the delivery volume was 30.51%. This implies that there was large liquidation at a loss from HNI’s. They had borrowed at an average of 4.5% and the cost of funding in the HNI category was Rs 8.25 and in the shareholder category was Rs 3.55. In either case they lost money.
The weighted average of the day was Rs 313.77 on the BSE and Rs 314.02 on the NSE. The closing price was a good Rs 16-17 lower or almost 5%, indicating that in the end there was panic. The company is good and the business prospects promising. Markets behave in a manner that they understand best. While the debut was poor and far from satisfactory, let us hope that things improve when the company announces its quarterly results later this month.

Shares of GNA Axles Limited listed on the BSE and NSE and were off to a flying start gaining almost 20% on day one. The company had issued through a fresh issue offered 63 lakh shares in a price band of Rs 205-207. The company raised Rs 130 crs from this issue.It had allotted 18.30 lakh shares to three mutual funds namely UTI, Reliance and HDFC at Rs 207. The issue had received unprecedented success and was oversubscribed 54.88 times. The QIB portion was subscribed 17.18 times, HNI 217.47 times and retail 11.84 times. There seemed to be a fancy for this share and the issue was open for subscription what the decent sized L&T Technology Services Limited was open.
Shares listed for trading in the ‘trade to trade’ segment as the size of the issue was less than Rs 250 crs. The discovered price was Rs 248.50 on the BSE and Rs 252 on the NSE. The high of the day was Rs 260 on the BSE and Rs 261.80 on the NSE while the low was Rs 242.20 on both the exchanges. The total traded volume was 21,13,154 shares which was 33.54% of the issue size. As 100% of the trade has to result in delivery this was also the delivery percentage. IF one excludes the anchor portion which has a lock-in for 30 days the traded volume and delivery was 47.27%.
No names have appeared either on the buy or sell side of any institution. Things would become clearer as the trade to trade period of ten trading sessions comes to an end after two weeks. Currently the price would move in a daily circuit filter of 5% and volumes would get muted as we go forward.

From the table above one can see that the weighted average of the day was Rs 250.72 and Rs 251.12 on the two bourses, indicating that investors who sold at the open made decent gains. The share thereafter was under some pressure and closed lower than the day’s average at Rs 245.15 and Rs 248. The gains on day one were a healthy 18.43% and 19.81% respectively.
A good show by a small company from Punjab and opening the door for many more companies to tap the capital markets going forward.

The fresh issue from HPL Electric & Power Limited (HPL) for Rs 361 crs in a price band of Rs 175-202 was subscribed in the last half an hour. It received bids for 11.64 cr shares and was subscribed 8.06 times. The company had earlier allotted 53.61 lac shares to 9 anchors consisting of 13 entities.
The objects of the issue are to retire existing debt and use proceeds for working capital.
The full details of the subscription are given below: –