The stock opened at Rs 824 on BSE, at a discount of 3.73% to its issue price of Rs 856 and closed at Rs 848.40 apiece on BSE, 0.89% lower than its issue price
Microfinance institution Spandana Sphoorty Financial had a weak debut on the bourses on Monday as it closed a tad below its issue price.
This is the tenth IPO this year to be listed at a discount to its issue price.
It opened at Rs 824 on BSE, at a discount of 3.73% to its issue price of Rs 856, and touched an intra-day high of Rs 865 before closing at Rs 848.40 apiece on BSE, 0.89% lower than its issue price. On NSE, it closed at Rs 847.80 per scrip, lower 0.95% its issue price.
TEPID LISTING
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- The stock opened at Rs 824 on BSE, at a discount of 3.73% to its issue price of Rs 856 and closed at Rs 848.40 apiece on BSE, 0.89% lower than its issue price
- According to analysts, the listing is on expected lines given the stock is overpriced at a time when non-banking financial services sector is under stress
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According to analysts, the listing is on expected lines given the stock is overpriced at a time when non-banking financial services sector is under stress with concerns over asset quality and liquidity related issues.
Spandana Sphoorty’s Rs 1,200 crore IPO was fully subscribed and the company received bids 1.05 times of the total issue size earlier this month. The price range for the IPO was set at Rs 853-856 per share. The issue comprised an offer for sale of up to 93 lakh shares, including dilution by early-stage investors and by the promoter group, totalling Rs 800 crore.
The company had raised Rs 400 crore from the fresh issue of shares.About 4.72 lakh shares were traded on the BSE and 46.32 lakh shares traded on the NSE during the day. Spandana Sphoorty's market capitalisation was Rs 5,444.78 crore on the BSE.
The Hyderabad-based rural-focused micro-lender offers small-ticket unsecured income generation loans, business loans and loans against gold jewellery to women from low-income households in rural areas. According to an analyst, the microfinance institution made a successful exit from the corporate debt restructuring mechanism in March 2017, a year well ahead of the schedule.
“But the issue price is too expensive compared to its peers. When the market is witnessing corrections and when some good largecaps and midcaps are available at a value price point, I don't see a rationale to invest in such expensive IPOs,” the analyst said.
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