Euro Multivision Day one

October 16th, 2009 Comments Off on Euro Multivision Day one

Share simply crashed with huge volumes

Thursday the 15th of October was the auspicious day of ‘Dhanteras’ when people buy precious metal typically silver and bring wealth to the house. It coincided with the listing of Euro Multivision Limited’s IPO. The listing was good but the day was a disaster for almost all its investors. A large number of institutional investors have sold in the first 20/25 minutes when the stock was trading in the 79-80 range.

Stock opened well and was trading in positive territory for the first 20 minutes or so. The high made on BSE was Rs 80.90 and on the NSE was Rs 80.70. Thereafter it started falling and the low of the day was made in the last ten minutes of trade for the day. The low on BSE was Rs 51.60 while on the NSE it was Rs 51.65. The trading volume was huge with 4.23 cr shares being traded. This trading is 4.91 times the issue size of the IPO of 86 lakh shares. The delivery volume was also significantly higher, with 57.19 lakh shares being delivered. In terms of percentage to traded shares it was a mere 13.53% but when looked at in comparison with the IPO size it is 66.5%. In fact what this means is that 2 out three shares allotted in the IPO have changed hands on day one. This high delivery is unheard of in recent times.

Institutional investors have also sold on day one and as much as 17.35 lakh shares were delivered by them.

Exchange Open High Low Close Net Change % gain Volume Delivery Del % age Wt Avg
BSE 70.00 80.90 51.60 53.20 -21.80 -29.07 20729385 3156884 15.23 63.97
NSE 75.00 80.70 51.65 52.00 -23.00 -30.67 21536334 2562042 11.90 62.75
Total 42265719 5718926 13.53

From the table above one other interesting fact emerges. The weighted average of trade on the BSE was Rs 63.97 while the adjusted close is Rs 53.20. This means the price has further fallen by Rs 10.77 from the average or is 16.8% lower than the average. On the NSE the weighted average of trade is Rs 62.75 and the close Rs 52, a loss of Rs 10.75 or 17.13%. This indicates that if prices do not improve today we could see a sharp fall today as well.

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Indiabulls Power Issue Oversubscribed almost 22 times

October 16th, 2009 Comments Off on Indiabulls Power Issue Oversubscribed almost 22 times

The IPO of Indiabulls Power Limited closed for subscription yesterday. It received excellent response from institutional investors and reasonable response from HNI’s and just about enough from retail investors.

QIB 40.4942
HNI 5.7636
Retail 1.0913
Overall 21.84

The company had come out with its IPO in the price band of Rs 40-45 and the issue was for 33.98 cr shares. The company had made an allocation of 6.11 cr shares at Rs 45 to anchor investors prior to the public offering of shares.

The response overall is better than Adani Power which had a total subscription of 21.64 times. The HNI category in Adani Power was oversubscribed 8.62 times while the retail was 2.96 times. The QIB was 39.47 times. There were a couple of differences between the two issues. Firstly there was a lot of hype created and generated during the issue of Adani Power. This time around there was none whatsoever. The issue of Indiabulls Power came and went. Secondly investors were expecting to make huge money in Adani Power post listing which did not materialise. As a result of this failure, the response this time from HNI’s and retail is muted. Probably this lack of expectation will make the difference and of course the fact that the issue is reasonably priced.

This muted response from the HNI and retail will be the icing on the cake for this issue. Readers would recall my view on this company in my issue analysis where I had stated that this issue is attractively priced and far cheaper than Adani Power. The stock of Adani Power which listed on 20th August has been trading in a narrow range around the issue price of Rs 100. The high in about two months of trading has been Rs 107.90 made on listing day and the low Rs 97.25. The stock closed at Rs 100.15 yesterday. It may be of interest that in the same period the BSESENSEX has moved from 15012 to 17195, a gain of 2183 points or 14.54%.

It may also be relevant to look at the issue of NHPC which was issued at Rs 36 and listed on 1st September. The stock made a high of Rs 39.75 on listing day and a low of Rs 32.45 yesterday. The share closed for trading at Rs 33.50 yesterday.

Looking at this scenario, I am of the firm belief that investors who have reposed faith by subscribing to the IPO of Indiabulls Power Limited will make money in this issue.

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Euro Multivision Crashes on Listing Day!

October 15th, 2009 Comments Off on Euro Multivision Crashes on Listing Day!

Shares of Euro Multivision which listed today, opened firm but crashed thereafter. The shares made a low of Rs 51.60 and Rs 51.65 on the BSE and NSE respectively. The shares closed at Rs 53.20 and Rs 53.55 respectively with a loss of 29% and 28.6% respectively.

In recent listings this is probably the worst closing for any issue on day one.

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