Snapdeal Parent AceVector Lists 11.5% Below Issue Price as Orient Cables Surges 65%

Monday's crop of new listings showed how unevenly India's primary market is rewarding investors right now. Of four companies that debuted on the exchanges, one delivered a bumper gain, two barely moved, and the most recognisable name of the lot, Snapdeal's parent AceVector, opened in the red.

Together the four had raised about Rs 1,776 crore through issues that ran between September 25 and 29.

AceVector: a well-known brand, a weak start

AceVector's shares opened at Rs 28.32 on the NSE and Rs 28.30 on the BSE, discounts of roughly 11.5% to the issue price of Rs 32. An investor who received one lot of 468 shares was sitting on a paper loss of about Rs 1,730 at the opening price.

The Rs 420 crore issue, priced in a band of Rs 30 to Rs 32, included a fresh issue of about Rs 287 crore and an offer for sale of about Rs 133 crore. The new money is mostly meant for marketing and technology at Snapdeal. Demand looked respectable on paper, with the issue subscribed about 4.9 times, but the grey market had already been pointing to a flat debut, with unofficial premiums of around Re 1 per share in the days before listing. The opening price fell well short even of that.

The result adds to a pattern of investors treating loss-making or turnaround consumer internet stories with caution in a market that has been under heavy pressure for weeks. We covered the issue when it opened.

Orient Cables: the standout

At the other end of the scale, Orient Cables (India) listed at Rs 450 on the NSE, a 65.4% premium to its issue price of Rs 272, and at Rs 448.10 on the BSE. That handed allottees a gain of roughly Rs 9,800 per lot of 55 shares at the open, comfortably ahead of grey market indications that had suggested a premium in the 42-44% range.

The Rs 552 crore issue had drawn an enormous response, subscribed more than 97 times with bids worth close to Rs 37,600 crore. Our earlier coverage has details on the offer.

Runwal and German Green Steel: little change

Runwal Enterprises, which raised Rs 500 crore entirely through fresh shares, listed at its issue price of Rs 305 on the NSE and at Rs 306 on the BSE. The issue had been subscribed only about 2.65 times, and the grey market had been quoting a small discount.

German Green Steel and Power opened at Rs 142 on the NSE and Rs 143 on the BSE against an issue price of Rs 139, gains of about 2% to 3%. Its roughly Rs 304 crore issue had been subscribed 30.5 times.

What the split tells investors

The contrast between Orient Cables and AceVector underlines that headline subscription numbers alone are a poor guide to listing-day returns. Orient Cables combined very deep institutional and retail demand with an industrial business tied to power and infrastructure spending, a theme investors have been willing to pay for. AceVector's demand was thinner and its grey market signal was already soft. With the Sensex only just snapping an eight-day losing streak on Monday, appetite for riskier listings remains selective.

This is an original summary based on public reporting. See our editorial policy for how we source, write, and correct our stories.