Shares of Credit Access Grameen Limited listed on the bourses and had a poor opening. Shares were issued at Rs 422 and debuted at Rs 385 on the BSE and Rs 390 on the NSE. They did recover from there and manage to close around the issue price.

The company had launched its simultaneous offer for sale and fresh offer. The issue consisted of a fresh issue of Rs 630 crs and an offer for sale of 1,18,76,485 shares in a price band of Rs 418 to 422. The company had raised Rs 1,131.18 crs at the top end of the band.

The company had allotted 80,41,617 shares to 20 anchor investors comprising of 23 entities. The top allocation was made to Neuberger Berman Emerging Markets Equity Fund who was allotted 10,66,345 equity shares or 13.26% of the equity.

The issue was subscribed 2.22 times with QIB portion subscribed 5.52 times, HNI 0.98 times and retail 0.88 times. The issue was under pressure during subscription and the fact that this company though being a microfinance company yet not into a small finance bank, was not understood and not appreciated either. The costs involved with converting a micro finance company business into a bank are tremendous and have a telling impact on the initial three to four years of a company’s performance.

Coming to the listing itself, post the discovered price the share began its climb towards the issue price and made a high of Rs 423.30 on the BSE and Rs 426.90 on the NSE. The traded volume was 135.83 lacs combined on the two exchanges. Weighted average of the day was Rs 412.92 on the BSE and Rs 412.42 on the NSE, signifying that the recovery from the opening discovered price was swift and the bulk of the day’s trade happened at higher prices.

Delivery was 43.57 lac shares which was 32.08% of the traded volume. If one considers the traded volume as a percentage of the IPO size it was 50.68%. The delivery as a percentage of the IPO size was 16.25% and based on non-anchor portion was 23.22%. This is a low percentage and because there were no names reported on the institutional side either as buyers or sellers, indicates that the share would need to consolidate at current levels before any up move could be expected.

For the record, the share closed at Rs 420.80, down Rs 1.20 or 0.28% on the BSE and at Rs 422.05, up Rs 0.05 or 0.01% on the NSE. The share effectively did nothing and at best could be classified as an average listing. One needs to se how the share fares in the coming days and what its June results have in store for the market.

Markets were volatile and choppy in the short four-day week with a mid-week holiday on Wednesday for Independence Day. While the net weekly change was small, each day saw net movement of 200 points or thereabouts on the BSESENSEX, beginning with losses on Monday and gains on subsequent Tuesday. The same pattern was repeated on Thursday and Friday. The net change was a gain of 78.65 points or 0.21% with the BSESENSEX closing at 37,947.88 points. NIFTY gained 41.25 points or 0.36% to close at 11,470.75 points. Markets did not make new highs this week.

In primary market news. The IPO from Credit Access Grameen Limited, the microfinance company would be listing on Thursday the 23rd of August.

In news the former Prime Minister of India Atal Behari Vajpayee passed away at the age of 93. He was the first non-congress PM to complete his 5-year term. In corporate news the CFO of Infosys, Ranganath has quit after putting in 18 years at the company. He was the CFO since Bansal had quit in 2015. Probably things are not as hunky dory as one may have expected ever after the stink raised by former promoters of Infosys after the Panaya acquisition. Things at Infosys have not been the same after the induction and subsequent parting of Vishal Sikka. There has been a constant spate of resignations and the spat between the former promoters and management. One simply wonders when things would be sorted out.

The week ahead has a similar trading holiday on Wednesday and would be divided into two distinct halves. Volatility would continue to hurt the markets and a serious attempt would be made to make new highs on the benchmark indices. The new highs are less than a day’s gain away with the difference of 125 points on the BSESENSEX and 25 points on the NIFTY. While the distance is literally a stone’s throw away it could take some time to get there as neither the bull nor the bear would like to give way. This is what could lead to volatility and markets would react to any news and market performance of Dow Jones.

I have been able to anticipate the market movements over the last 6-8 weeks and the same can be reflected in the weekly calls. The July rally that unfolded was well called and is now behind us. Going forward the bull rally will end only on euphoria and that is to happen shortly. It’s during this euphoria that greed will take over and a sharp correction would unfold. The time available is under 12-15 trading days. How this would unfold is a little hazy.

Simple advice – Stick to quality, book profits and keep your ammunition dry, it will be very handy when markets correct sharply.