Between January 2021 and now, over 100 mainboard companies tapped the Indian capital market raising over ₹1.78-lakh crore in public issues. In this period, nine Chennai-based companies and one Tuticorin-based company made their market debut raising around ₹20,000 crore through initial public offerings (IPOs).
businessline analysed the IPO debut and the stock performance of these 10 companies since their listing. Five out of these 10 companies delivered listing gain to investors. LatentView Analytics, which made a blockbuster market debut in November 2021, delivered the highest listing gain. The stock listed at a premium of 160 per cent over its issue price of ₹197 per share on NSE. It was followed by Go Fashion (90 per cent premium) and Data Patterns (46 per cent).
While retail and technology-based companies like LatentView Analytics, Data Patterns (India) and Go Fashion attracted investor interest, traditional businesses like Star Health and Allied Insurance, Five-Star Business Finance and Tuticorin-based Tamilnad Mercantile Bank failed to impress the investors. All these stocks ended up listing at a discount. Ed-tech company Veranda Learning Solutions also listed at a discount of 9 per cent on the NSE against the issue price of ₹137 apiece.
Issue price vs market price
However, a comparison of the issue price with the current market price throws a different picture altogether. Six out of the 10 stocks are trading above their issue price. Data Patterns (India) is trading at 112 per cent higher than its issue price of ₹585 per share while Veranda Learning Solutions, which is listed at discount, is trading 86 per cent higher than its issue price. On the other hand, Chemplast Sanmar, which listed at a premium, is trading at ₹447 apiece, 17 per cent lower than its issue price.
Another way to look at a stock performance is to compare the current market price with its listing price. This metric shows that it is the steady-going tortoise that ultimately beat the erratic hare in the race. Only three out of the 10 stocks are currently ruling over their listing price.
For instance, Veranda Learning and Five-Star Business Finance – which are listed at discounts – are among the three stocks that are trading above their listing price. While stocks like LatentView Analytics, Go Fashion, Chemplast Sanmar and Radiant Cash Management, which are listed at premium, are trailing below their listing price. Star Health and Allied Insurance trading at 36 per cent discount over its listing price of ₹845 per share.