MAS Financial Services Limited which had tapped the capital markets with its simultaneous fresh issue and offer for sale listed on the bourses and gained over 42%.
The company had raised Rs 460.04 crs through a fresh issue of Rs 233 crs and an offer for sale of Rs 227.04 crs. It had allotted 29,61,057 equity shares to 15 anchor investors comprising of 21 entities. The price band was Rs 456-459 and shares were allotted at Rs 459.

The issue was subscribed issue 148.33 times by QIB’s, 378.53 times by HNI’s and almost 16 times by retail investors. The cost of funding at 5.5% was around Rs 183 for the leveraged HNI.

The issue opened at Rs 660 on both the exchanges which was Rs 201 higher than the issue price of Rs 459. The high of the day was Rs 680.95 and 681.50 while the low was Rs 625 on both the exchanges. The share closed at Rs 654.75 on the BSE with gains of Rs 195.75 or 42.65%. On NSE the share closed at Rs 654.40, a gain of Rs 195.40 or 42.57%. While the performance of the share would be termed as excellent it was disappointing for the leveraged HNI as his returns were paltry compared to his overall investment. On an application of Rs 100 crs where he would have paid a margin of Rs 50 lakhs to 1 crs and an upfront interest of 10.55 lakhs, he would get allotment of 5,763 shares. Assuming he sold at the average price of Rs 657 he would have earned Rs 37,86,291 from the sale of the shares. He would have paid for them Rs 26,45,217 as cost of shares and Rs 10.55 lakhs as interest making his total outgo as 37,00,217. His net return on a risk of Rs 100 crs was Rs 86,073.

The traded volume was 207.94 lakh shares which was 2.07 times the IPO size. Delivery volume was 48.89 lakh shares which was 23.51% of traded volume and 48.79% of the IPO size. Adjusted for non-anchor portion which comes with a lock-in period the same was 69.24%.

If one were to compare the returns of the leveraged investor in MAS with Godrej, in that issue the oversubscription was 236.04 times and coincidentally the price was almost identical at Rs 460. He would have got on an application of Rs 100 crs, 9211 shares. His sales realisation would be Rs 55,26,600. His cost would be Rs 42,37,060 plus interest of Rs 10.55 lakhs making it Rs 52,92,060. His net profit would be Rs 2,34,540. The above is an example of the risk being taken by this category of investors and the kind of damage it could do to the safety of the market.

As far as the lucky retail investor is concerned, he had good returns and made excellent profit. Alas the lottery system is cruel.