Auro Impex & Chemicals Ltd SME-IPO lists flat but closes -3.6% lower

Auro Impex & Chemicals Ltd had a tepid listing on 23rd May 2023, listing flat at the issue price but closing -3.59% lower. During the day, the stock went slightly above the listing price and then traded under pressure. This is despite the fact that the markets remained buoyant and the Nifty actually closed 33 points higher for the day. However, the stock of Auro Impex & Chemicals Ltd lost ground after opening and closed with losses for the listing day. For now, the headwinds like the inversion of the yield curve, the negative news flows on banks and the SVB Financial crisis are the major talking points and continue to keep the markets under pressure at higher levels and the traders cautious. However, this is just the listing day performance of the stock and long term story could be different.

The stock of Auro Impex & Chemicals Ltd did show a flat opening but tapered through the day and finally closed well below the issue price and the listing price on the NSE. Being an NSE SME IPO, it is only traded on the SME segment of NSE. Auro Impex & Chemicals Ltd opened absolutely flat on Tuesday and the opening price turned out to be the resistance price for the day. With subscription of 50.72X for the retail portion,  104.05X for the HNI / NII portion and 31.67X for the QIB portion; the overall subscription was quite healthy at 66.94X. The subscription numbers were so strong but the stock did not respond in a strong manner and instead closed weak after a flat opening.

The SME IPO of Auro Impex & Chemicals Ltd was priced at Rs78 via fixed price format. On 23rd May 2023, the stock of Auro Impex & Chemicals Ltd listed on the NSE at a price of Rs78, which is exactly at the IPO issue price of Rs78. Hence there was no discount or premium on listing. However, the stock later faced resistance at higher levels and it closed the day at a price of Rs75.20, which is -3.59% below the IPO price and -3.59% below the listing price of the stock on the first day of listing. In a nutshell, the stock of Auro Impex & Chemicals Ltd had closed the day much lower than the listing price and the IPO price for the stock. The upper circuit price on listing day is calculated on the listing price and not on the IPO price. The opening price actually turned out to be near to the high price of the day. However, the stock did not get anywhere close to the upper or lower circuits

On Day-1 of listing i.e., on 23rd May 2023, Auro Impex & Chemicals Ltd touched a high of Rs78.50 on the NSE and a low of Rs74.20 per share. The opening price turned out to be near to the high point of the while the stock closed nearer to the low point of the day. During the day, the stock did touch the lower circuit price of 5% but bounced from these levels. What is truly surprising is that the stock closed weak despite the overall Nifty rising on the day and the subscription of the stock being extremely strong.

Let us now turn to the volumes of the stock on the NSE. On Day-1 of listing, the Auro Impex & Chemicals Ltd stock traded a total of 14.18 lakh shares on NSE SME segment amounting to value of Rs1,094.25 lakhs on the first day.  The order book during the day showed a lot of selling with the sell orders consistently exceeding the buy orders at any point of time. That also was instrumental in the stock closing at near to the lower end of the circuit filter. It must be noted here that Auro Impex & Chemicals Ltd is in the trade to trade (T2T) segment so only delivery trades are possible on the stock. Hence the entire volume for the day purely represents the delivery volumes.

At the close of Day-1 of listing, Auro Impex & Chemicals Ltd had a market capitalization of Rs91.75 crore with free-float market cap of Rs25.86 crore. It has a total of 122.01 lakh shares as the issued capital of the company. As stated earlier, since the trading is on the T2T segment, the entire volume of 14.18 lakh shares during the day is accounted for only by delivery trades.