The Economic Times daily newspaper is available online now.

    Every stock is not DMart! IPO listing pop doesn’t last 30 days in most cases

    Synopsis

    Out of 14 such debutants, whose listing day gains were in excess of 40 per cent between FY17 and FY20, shares of seven companies trade below Day 1 closing levels today, data compiled from Prime Database suggests.

    IPOETRealty
    The 12-month list excludes stocks such as Ujjivan SFC, CSB Bank and IRCTC, which are yet to complete one year of listing.
    NEW DELHI: Not every stock is Dmart, and listing day euphoria is no guarantee of future returns.

    Happiest Minds’ stellar 111 per cent listing gain might have been tempting for the not-so-lucky secondary market investors, but data suggests half the issues that logged strong listing gains in last four financial years have failed to offer any further upside post listing.

    Out of 14 such debutants, whose listing day gains were in excess of 40 per cent between FY17 and FY20, shares of seven companies trade below Day 1 closing levels today, data compiled from Prime Database suggests.

    Eight of them, in fact, ruled below their Day 1 closing prices after a month, while six quoted below those levels after three months, and five after 12 months.

    The 12-month list excludes stocks such as Ujjivan SFC, CSB Bank and IRCTC, which are yet to complete one year of listing.

    Apollo Micro Systems, which jumped 73.81 per cent to Rs 454.10 in debut trade on January 22, 2018, today trades at Rs 126.85, down 72 per cent from the listing day closing price, and 54 per cent from the issue price of Rs 275. There has been no corporate action like stock split or bonus issue during this period.

    Astron Paper & Board Mill’s whooping 128 per cent listing day gain in 2017 has since fizzled out. The stock today trades at Rs 44.65, down 63 per cent over its listing day closing price of Rs 119.70 and 10.7 per cent from its issue price of Rs 50.

    Another 2017 listing Capacit’e Infraprojects logged 59 per cent listing day pop, but the stock is nowhere near those levels now. At Rs 133, the stock is down 61 per cent from its listing day closing price of 342.40, and 46.8 per cent over its issue price of Rs 250.

    Ujjivan Small Finance Bank is down 7 per cent from its issue price of Rs 37, and 38 per cent from its listing day closing price of Rs 55.90.

    Salasar Techno Engineering, CSB Bank and Quess Corp are some of the other stocks which failed to hold their listing day gains. But they still trades above issue prices.

    The stocks that gave up listing day gains in the very first month included CSB Bank, Apollo Micro Systems, Salasar techno Engineering, Mas Financial Services, Dixon Technologies, HDFC AMC, Ujjivan SFC and Capacit'e Infraprojects.

    Apollo Micro Systems, CSB Bank and Ujjivan SFC were among stocks that eroded 47-72 per cent of their values in the first six months.

    “Secondary market investors should be more careful and try to avoid falling for listing day euphoria. They should wait for correction, as not every stock is DMart. Investors can evaluate initial corporate earnings and see if the management commentaries are as strong as the pre-listing period. If that's the case, there is no harm in investing," Astha Jain of Hem Securities.

    Jain said Rossari Biotech, which rose 75 per cent on its listing day to Rs 742.35 is now trading at Rs 825.85 and has also reported healthy earnings in the lockdown-hit June quarter.

    Among the star IPOs in the past, Avenue Supermarts added 239 per cent over its listing day gain of 87 per cent. The stock closed Rs 2,172.80 on Friday against its issue price of Rs 299 and Day 1 closing price of Rs 640.75.

    Dixon Technologies has gained 236 per cent over and above the 54 per cent listing day gains.



    (What's moving Sensex and Nifty Track latest market news, stock tips and expert advice, on ETMarkets. Also, ETMarkets.com is now on Telegram. For fastest news alerts on financial markets, investment strategies and stocks alerts, subscribe to our Telegram feeds .)

    Download The Economic Times News App to get Daily Market Updates & Live Business News.

    Subscribe to The Economic Times Prime and read the Economic Times ePaper Online.and Sensex Today.

    Top Trending Stocks: SBI Share Price, Axis Bank Share Price, HDFC Bank Share Price, Infosys Share Price, Wipro Share Price, NTPC Share Price

    ...more


    (What's moving Sensex and Nifty Track latest market news, stock tips and expert advice, on ETMarkets. Also, ETMarkets.com is now on Telegram. For fastest news alerts on financial markets, investment strategies and stocks alerts, subscribe to our Telegram feeds .)

    Download The Economic Times News App to get Daily Market Updates & Live Business News.

    Subscribe to The Economic Times Prime and read the Economic Times ePaper Online.and Sensex Today.

    Top Trending Stocks: SBI Share Price, Axis Bank Share Price, HDFC Bank Share Price, Infosys Share Price, Wipro Share Price, NTPC Share Price

    ...more
    The Economic Times

    Stories you might be interested in