Sula Vineyards Ltd IPO lists at premium of 1.12% and then tapers

Sula Vineyards IPO had a tepid listing on 22nd December 2022, listing at a premium of just of 1.12%, but closing the day well below the listing price as well as the issue price of the IPO. While the stock did show some bouts of volatility during the day, it closed more than 7.5% below the issue price on the first day of trading on the NSE. It also closed well below the listing price. With subscription of 2.33X overall and QIB subscription at 4.13X, the listing was expected to be moderate, at the very best. Here is the Sula Vineyards Ltd listing story on 22nd December 2022.

The IPO price was fixed at the upper end of the band at Rs.357 which was anyways rather ambitious considering the rather moderate 2.33X overall subscription and the 4.13X QIB subscription in the IPO. The price band for the IPO was Rs.340 to Rs.357. On 22nd December 2022, the stock of Sula Vineyards Ltd listed on the NSE at a price of Rs361, a premium of 1.12% over the IPO issue price of Rs357. On the BSE also, the stock listed at Rs358 a marginal premium of 0.28% above the issue price.

On the NSE, Sula Vineyards Ltd closed on 22nd December 2022 at a price of Rs329.90. That is a first day closing discount of -7.59% on the issue price of Rs357 and a discount of -8.61% on the listing price of Rs361. On the BSE, the stock closed at Rs.331.15. That represents a first day closing discount of -7.50% below the issue price and a discount of -7.24% below the listing price on the stock exchange. On both the exchanges, the stock listed marginally above the IPO issue price but closed Day-1 sharply below the listing price and the IPO price too. Clearly, the tepid subscription took its toll on the first day of listing as there was a rush to exit the stock after the weak opening.

On Day-1 of listing, Sula Vineyards Ltd touched a high of Rs.363.30 on the NSE and a low of Rs.328.30. The discount sustained through the day. In fact, if you look at the range of prices, the stock opened near to the high price of the day but closed near to the lower price of the day, hinting at underlying weakness in the stock price and demand structure. On Day-1 of listing, the Sula Vineyards Ltd stock traded a total of 80.73 lakh shares on NSE amounting to value of Rs.280.80 crore on the first day. The order book during the day showed a lot of selling pressure with the sell orders far exceeding the buy orders at any point of time.

On the BSE on Day-1 of listing, Sula Vineyards Ltd touched a high of Rs.363.40 and a low price of Rs.328.60. The discount sustained through most of the day. In fact, like on the NSE, even on the BSE, if you look at the range of prices, the stock never crossed the issue price through the day and it closed very near to the low price of the day, while the opening was near to the high price of the day, an indicator of stock weakness. On Day-1 of listing, the Sula Vineyards Ltd stock traded a total of 4.23 lakh shares on the BSE amounting to value of Rs.14.59 crore on the first day.

While the volumes on the BSE were not as much as on the NSE, the trend was once again the same. The order book through the day showed a lot of selling pressure with the sell orders far exceeding the buy orders at any point of time. That make it a sell on rises stock through the day. On the NSE, out of the total 80.73 lakh shares traded during the first day of trading, the deliverable quantity represented 48.15 lakh shares or a deliverable percentage of 59.64% on the NSE. That shows a lot of delivery selling. Even on the BSE, out of the total 4.23 lakh shares of quantity traded, the deliverable quantity at a gross across client level was 1.60 lakh shares representing total deliverable percentage of 37.84%.

At the close of Day-1 of listing, Sula Vineyards Ltd had a market capitalization of Rs.2,788.24 crore with free-float market cap of Rs.724.94 crore.