If everything goes well, Diwali will be arriving 16 days ahead in Dalal Street this year. While the calendar says the auspicious occasion is on October 31, the fireworks will be lit by the Hyundai Motor IPO, bid for which will open on Tuesday, October 15. However, the Korean passenger car maker will be up against unenviable track record of mega IPOs in the country most of which, save one, have registered listing losses.
Between 2008 and 2022, 5 IPOs were floated each of which mopped up over Rs 10,000 crore from the market. Only one of these managed to register listing gains while 5 debuted in the market at a price lower than the issue price. Let’s take a close look.
LIC and Paytm’s listing losses
On May 17, 2022 the 800-lb gorilla in India’s insurance market, LIC listed in the bourses registering a 7.8% loss. It has raised Rs 20,557 crore which is still the country’s biggest IPO. The second biggest IPO – that of Paytm which mopped up Rs 18,300 crore – also posted the biggest listing loss – that of 27.3% on November 18, 2021.
Reliance Power, SBI Cards, GIC
Reliance Power which raised Rs 10,123 crore made a loss of 17.2% on the listing day of February 11, 2008. The other two IPOs in this category were GIC and SBI Cards. While GIC registered a listing loss of 4.6%, SBI Cards had a loss of 9.5%. GIC raised Rs 11,257 crore while SBI Cards mopped up Rs 10,341 crore. The smallest listing loss was registered by GIC.
The only mega IPO to stand out with a listing gain was PSU Coal India. It had raised Rs 15,199 crore and posted a gain of 39.7% on November 4, 2010.
Listing gain of 2.3%
Therefore, Hyundai Motor IPO will be under a lens. The GMP data, according to investorgain, the GMP (grey Market Premium) stood at Rs 45 on October 14, which almost underwent a free fall from Rs 570 on September 27. It translates into a listing gain of 2.3% only.
Though GMP is only an unofficial estimate that changes with time and does not definitively indicate anything (gain or loss on listing), it indicates investor enthusiasm and is taken as a vital metric by retail investors.
(Disclaimer: This article is only meant to provide information. News9live.com does not recommend buying or selling shares or subscriptions of any IPO and Mutual Funds.)
The biggest IPO in India’s stock market history will kick off in a few hours from now but it will be against a background of listing losses of most of the mega IPOs. Markets Business News – Personal Finance News, Share Market News, BSE/NSE News, Stock Exchange News Today
