Over 60% of this year’s newly listed cos stay above IPO price
Out of 11 companies that came out with their IPOs this year, seven have registered smart gains against the price at which they had issued shares to investors, an analysis of the stock performance of the newly-listed firms showed.
The rest four companies have however failed to attract investors and are quoting below their issue price. Microfinance player Ujjivan Financial Services which made stock market debut in May has seen the steepest rally in its share price and is trading about two times higher than the IPO price. Its IPO was oversubscribed nearly 41 times.
Both Equitas Holdings and Infibeam Incorporation that were listed in April, have given smart returns to their investors, soaring about 71 per cent and 62 per cent, respectively. Similarly, Parag Milk Foods shares have jumped 40.58 per cent, TeamLease Services climbed 29.38 per cent and Thyrocare Technologies zoomed 27 per cent.
In the case of Mahanagar Gas, its shares have jumped 22.92 per cent, as against the issue price. In stark contrast, four companies — Precision Camshafts, Quick Heal Technologies, HealthCare Global Enterprises and Bharat Wire Ropes — have failed to stay afloat.
Precision Camshafts, the first initial share sale of this year, has seen its shares plummet by over 31 per cent. Shares of HealthCare Global Enterprises have lost 13 per cent, Quick Heal Technologies is down 12.36 per cent and Bharat Wire Ropes (2.66 per cent).
Besides, staffing firm Quess Corp which concluded its IPO earlier this month is yet to make its stock market debut. The BSE Sensex meanwhile has gained 1,049.33 points or 4 per cent at 27,166.87 so far this year.
Meanwhile, a “credible road map” has been put in place for the listing of NSE, Chairman Ashok Chawla has said, adding that it will provide a market-determined benchmark for its share price and enhance the level of corporate governance. “There comes a time when corporates are mature enough to go public,” said Chawla.
“The NSE board has considered this and decided to pursue listing of its stock. This will provide a market-determined benchmark for its share price, apart from enhancing the level of corporate governance.”
Putting speculations to rest, NSE announced its plans on June 27 to get listed domestically as well as internationally under which the bourse would file preliminary IPO papers with Sebi by January 2017. Decisions related to listing were taken during the board of directors’ meeting on June 23.
Asked about the acrimony in the wake of some investors criticising the exchange for delay in listing, Chawla said, “I won’t call it acrimony. But, yes the shareholders have been pressing for early listing of the stock so that they get the benefit of a good valuation if they choose to exit.”
On whether the issues with investors have been solved, he replied in the affirmative as the bourse has announced a credible road map. “Work will now start on the various pieces, apart from the critical requirements of shareholders’ consent and the approval of Sebi,” he noted.
NSE has already set up a sub-committee to work on the listing process. With respect to proposed restructuring at the bourse, Chawla said it would continue to be in focus provided there are no “insurmountable difficulties”.
“We will pursue it (restructuring) if it is seen by the shareholders as in the larger interests of the organisation. Approval of the regulator will also be required. As long as it does not pose insurmountable difficulties for the main goal, which is listing, it will continue to be in focus,” he added.
In response to a query on whether the bourse could face dissent when it goes for listing, Chawla said, “Not for listing”.