Even while topline information technology (IT) stocks witnessed a freefall following Wednesday?s third largest market decline, a small-cap company engaged in knowledge management and training, Everonn Systems India Limited, made a stunning debut on the bourses.
After listing at Rs 245 against the issue price of Rs 140, the stock aggressively scaled to touch a high of Rs 567 on the National Stock Exchange (NSE). Before closing at Rs 477.35, it managed to gain a whopping Rs 337 or 240.96% in the drastically falling market. In the process the counter churned out a turnover of over Rs 500 crore on the volume of over one crore shares.
Some of the brokers believe that the grey market has a great impact on most new listings these days and it is for this reason that they list with high premium initially. Deven Choksey, MD, KR Choksey Securities feels that a small company like Everonn Systems cannot have much effect of the falling markets. ?However, it can be said that the stock is an expensive proposition at these levels,? he said.
The analysis of new issues that listed on the bourses in last three months shows that nine out of 27 issues are trading below their issue price. These include Decolight Ceramics, down 49.44%, Hilton Metal Forging down 45.43%, Asahi Songwon down 37.72%, Insecticides India Ltd down 31.39%, Nelcast Ltd down 29.16%, Bhagwati Banquets down 21.50%, Fortis Health Care down 19.31%, Celestial Labs down 11%, Benani Cement down 10.67% and the follow-on public issue of India?s largets private sector bank ICICI Bank, which fell over 5% from its issue price.