Shares of Nazara Technologies Limited listed on the bourses and had a great start with the discovered price being Rs 1,971 on BSE and Rs 1,990 on NSE. They closed locked at the lower circuit of the day of Rs 1,576.80 on BSE and Rs 1,592 on NSE. Gains registered at close of day were a decent 43.22% on day one.

Nazara had tapped the capital markets with its offer for sale of 52,94,392 equity shares. The issue was oversubscribed 175.46 times. QIB portion was subscribed 103.77 times, HNI portion was subscribed 389.89 times, Retail portion was subscribed 75.29 times and Employee quota was subscribed 7.55 times. There were 23.34 lac applications and on basis of lots, Retail portion was subscribed 57.55 times.

The company had earlier completed allocation to anchor investors. The company allotted 23,73,395 equity shares at Rs 1,101 to 25 anchor investors comprising of 43 entities. The highest allocation of 1,99,823 shares or 8.4% of the anchor allocation was made to Government of Singapore. This was followed by 13 anchor investors who were allotted an identical 1,19,899 shares or 5.1% of the anchor book.

The issue had opened on Wednesday the 17th of March and closed on Friday the 19th of March 2021. The price band for a Rs 4 paid up equity share is Rs 1,100 – 1,101.

The discovered price on BSE was Rs 1,971, high of the day was Rs 2,026.90, low was the lower circuit at Rs 1,576.80 and this was also the close of the day. Shares gained Rs 475.80 or 43.22%. On NSE the discovered price was Rs 1,990, high was Rs 2,024.90, low was the lower circuit of Rs 1,592 and the close was also the same. Share gained Rs 491 or 44.60%.

Traded volume on the two exchanges was 83.28 lac shares which was 1.57 times the IPO size of 52.94 lac shares and 2.85 times the non-anchor portion of 29.20 lac shares. Delivery volume was 30.37 lac shares which was 36.47% of traded volume. It was 57.37% of the IPO size and 103.99% of the non-anchor portion. Very clearly some of the selling shareholders who did not exit totally through the IPO and still had shares which were not locked-in have cashed out. Market grapevine suggests that the sales are from the holding of IIFL Special Opportunities Fund.

Weighted average of the day’s trade was 1,704.73 on BSE and Rs 1,766.58 on NSE. Very clearly barring the opening of the day and the high immediately thereafter, the share was under pressure and hence the closing price is substantially lower than the weighted average. The cost of funding for the leveraged HNI was in the region of Rs 615-625. This suggests that all those who sold before the stock hit the lower circuit have made some money.

With 30 lac shares changing hands through delivery, no names were reported either on the buy side or the sell side. This suggests that people who have bought on day one, is small size tickets not coming under the ambit of reporting. With no hangover of existing investors from the IPO other than the pre-IPO shareholders who still have some free or non-lock in shares, one would see wild movement in the counter as the share has closed below average. The new buyers yesterday would have bought around the average and that is roughly 11% higher than the close. Interesting to see how the share would move in the coming days.

A choppy and volatile week came to an end with markets losing some ground. Friday’s recovery at the start of the new April series saw markets post gains and hence recover some ground. BSESENSEX lost 849.74 points or 1.70% to close at 49,008.50 points, while NIFTY lost 236.70 points or 1.61% to close at 14,507.30 points. The broader markets saw BSE100, BSE200 and BSE500 lose 1.50%, 1.34% and 1.36% respectively. BSEMIDCAP lot 0.37% while BSESMALLCAP lost 0.94%.

In primary market, listings of IPO’s which had closed for subscription in the previous week and now listed was not good news. As many as five issues listed during the week of which just one closed with gains, while another managed to recover on day two to close neutral. The other three were down in the region of 5% to 13.45%.

The first to list was Anupam Rasayan. The company had issued shares at Rs 555 and closed on day one at Rs 525.90, a loss of Rs 29.10 or 5.24%. Shares had listed on Wednesday and by close of week, the price had fallen to Rs 495.90, a loss of Rs 59.10.

The second to list was Craftsman Automation Limited which listed on Thursday. The company had issued shares at Rs 1,490 and closed day one at Rs 1,433, a loss of Rs 57 or 3.83%. It recovered lost ground on Friday and closed at Rs 1,492.60, a gain of Rs 2.60.

The third to list was Laxmi Organics Limited which listed on Thursday and had issued shares at Rs 130. The share closed listing day at Rs 164.60, a gain of Rs 34.60 or 26.62%. It gained further on Friday and closed at Rs 186.55, a gain of Rs 56.55 or 43.50%.

The fourth share to list was Kalyan Jewellers Limited which listed on Friday and had issued shares at Rs 87. The share closed trading at Rs 75.30, a loss of Rs 11.70 or 13.45%. What is worrisome is the fact that besides the poor listing, the traded volume was just about 41% of the issue size and delivery volume was 14.4% of the issue size. This makes one believe that going by past precedent, the share would be under pressure going forward.

He fifth and final share to list was Suryoday Small Finance Bank Limited which listed on Friday and had issued shares at Rs 305. The share closed trading at Rs 276.20, a loss of Rs 28.80 or 9.44%. Here as well, trading volumes at a mere 25% of the IPO size were very poor and could put the share under pressure going forward. Delivery volume was just about 10.37% of the IPO size which is the lowest among all issues during 2020-2021.

Very clearly it appears the IPO rush has ensured that fatigue factor has hit the markets and issues are under pressure on day one.

During the week we also saw the IPO of Barbeque Nation Hospitality Limited get subscribed 5.97 times. The QIB portion was subscribed 5.11 times, HNI portion was subscribed 3.10 times, Retail portion was subscribed 13.13 times and Employee portion did not receive any subscription.

March futures expired on a weak note and the series lost 772.45 points or 5.12% to close at 14,324.90 points. This was also the last series to expire for the financial year 2020-2021 where by and large, bulls have had the upper hand with the benchmark indices almost doubling from their lows made in March 2020.

On the covid-19 front, the world saw 12,82,33,105 patients, 28,04,219 deaths and 10,34,43,598 patients recovering. In India we saw 1,20,95,329 patients, 1,62,147 deaths and 1,13,90,829 patients recovering. Compared to the previous week the world saw, 43,82,201 new patients, 76,791 deaths and 36,65,135 patients recovering. In India we saw 4,49,610 new patients, 2,144 deaths and 2,41,595 patients recovering. Maharashtra is topping the number of new cases in India and people are quite taken aback by this upsurge. Night curfew has been imposed in Mumbai with effect from last night (Sunday). One hopes the administration is able to bring this outbreak under check as soon as possible.

The markets particularly the primary market has clearly come under fatigue and seems to be losing its grip. With poor performance of shares listing last week, one has also seen that shares which had listed earlier and registered gains are now slipping and many of them have slipped below their issue prices, while many more though still higher have seen most of the gains vanish.

Coming to the markets, the week ahead has mere three days of trade next week with holidays on Monday and Friday. With just three days, traders would like to be cautious and not go overboard on either side. Secondly the new financial year would have begun and people would be adjusting to the spate of bank holidays and getting their trading limits in place. Readers would recall that there is a bank holiday even on the 1st of April for normal banking activities on account of annual bank closure.

Markets seem to be getting support at the 48400-48600 levels on the BSESENSEX and 14250-14400 on NIFTY. This time is no different. At these levels, one finds the technical position/indicators in the market becoming oversold, FPI’s turning buyers and short-term traders looking to add to their longs in the market. We should expect the market to bounce from here in the immediate short term and look to exit longs at the first signs of markets looking heavy, which could be after a minimum up move past the 51k mark on BSESENSEX and 15k mark on NIFTY.

Trade cautiously and with a mindset of a quick entry and exit.