SEBI had tightened IPO Listing Rules in January 2012 to curb first days price volatility and manipulation by insiders….these are now implemented….IPO Issues below Rs 250 crs will be listed on only Delivery basis for the first ten days after listing and will have 5% tight circuit breakers on an equilibrium price discovered in a one hour pre auction window from 9 am to 10 am
Clearly this has affected Volumes on listing
Tribhovandas Bhimji Zaveri’s late April 2012 IPO to raise Rs 200 crs offered for 16.67 million shares at Rs 120…. just about got subscribed 1.15 times
It got listed on BSE in ‘T’ Category and NSE with circuit breakers of a shade over Rs 109 on the lower side and just under Rs 121 on the upper side…The volumes on both exchanges were low at @ 1.2 Million shares each with the average traded Price at @ Rs 112….the Share closed at Rs 111 without hitting circuits either on up or downside…clearly controlled to do so …next 10 days will be only delivery based trades with 100% upfront margin
Shrikant Zaveri and Family own 74.17% of the Equity of @ Rs 67 crs…FIIs hold 11.85%….Market Cap is just below Rs 750 crs
My sense is that the share price may seek lower levels and slip below Rs 100 as IPO Pricing of Rs 120 was on the higher side at Earnings Multiples of 12 against 5 to 8 for other Jewellers….PAT has shown a non linear trend over the years…probably to facilitate an IPO at such a pricing of Rs 120….PAT of @ Rs 7.5 crs in FY 2007 and FY 2008 moved to just over Rs 10 crs in FY 2009 and then jumped to @ Rs 17 crs in FY 2010…FY 2011 saw it zoom to Rs 40 crs and for the nine months at December 31,2011 it was Rs 50 crs
….clearly a lack ‘lustre’ listing that should remain lack ‘lustre’
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