Yudiz Solutions IPO lists at 12.12% premium, tapers later

Strong listing for Yudiz Solutions IPO, but fails to hold on

Yudiz Solutions Ltd had a relatively strong listing on 17th August 2023, listing at a moderate premium of 12.12%, but subsequently losing ground and closing below the listing price, albeit still above the IPO price. Against the IPO price of ₹165 for Yudiz Solutions Ltd, the stock listed at ₹185 and closed the day slightly lower at ₹181.90 per share. In a sense, the markets came under pressure as the Nifty fell by 100 points on the day and the Sensex fell by 388 points for the day on 17th August 2023. It was more about weekend profit booking as traders chose to stay light ahead of the weekend and after a very strong rally in the markets. However, despite such a weak day of trading, the listing of the stock was at a moderate premium of 12.12% although it could not sustain the gains for the day and closed lower than the listing price, although still above the IPO price.

The stock of Yudiz Solutions IPO did show a strength on opening and tried to hold higher. However, the pressure of the market overall was a little too hot to handle. The stock closed above the IPO prices issue price but it tapered below the listing price for the day. Being an NSE SME IPO, it is only traded on the SME segment of NSE. Yudiz Solutions Ltd opened 12.12% higher and the closing price turned out to be very close to the low price for the day. With subscription of 6.41X for the retail portion, 4.77X for the HNI / NII portion and 2.81X for the QIB portion; the overall subscription was moderate overall at 5.03X. The subscription numbers were so strong that it allowed the stock to list at a huge premium even on a day when the market sentiments were very weak. However, it could not sustain the gains for the day as the selling pressure on the market was quite strong.

Stock closes Day-1 at substantial premium

Here is the pre-open price discovery for the Yudiz Solutions SME IPO on the NSE.

Data Source: NSE

Yudiz Solutions IPO was priced in the price band of ₹162 to ₹165 via the book building format. On 17th August 2023, the stock of Yudiz Solutions Ltd listed on the NSE at a price of ₹185, a premium of 12.12% on the IPO issue price of ₹165. Not surprisingly, the price was discovered at the upper end of the band for the IPO. However, the stock faced pressure and could only traverse briefly above the listing price as it closed the day at a price of ₹181.90, which is 10.24% above the IPO issue price but -1.68% below the listing price of the stock on the first day of listing. In a nutshell, the stock of Yudiz Solutions Ltd had closed the day very close to the low price of the stock for the trading day. Like the upper circuit price, even the lower circuit price on listing day is calculated on the listing price and not on the IPO price at a range of 5% either ways. However, the stock did not hit either the upper circuit or the lower circuit. The closing price actually turned out to be very close to the low price of the day.

How prices traversed for Yudiz Solutions IPO on listing day

On Day-1 of listing i.e., on 17th August 2023, Yudiz Solutions Ltd touched a high of ₹191.00 on the NSE and a low of ₹181.00 per share. The high price of the day was well above the opening price of the stock while the stock closed very close to the low point of the day. What is truly appreciable is that the stock closed above the IPO price despite the overall Nifty falling by 100 points on 17th August 2023 and dipping below the psychological level of 19,400 on a closing basis for the listing day. The stock did not touch the circuit breaker either on the upside or on the downside. The close was relatively favourable with 3,200 buy quantity and no sellers on the stock counter. For the SME IPOs, 5% is the upper limit and also the lower circuit on the listing price on the day of listing.

Robust volumes for Yudiz Solutions IPO on listing day

Let us now turn to the volumes of the stock on the NSE. On Day-1 of listing, the Yudiz Solutions Ltd stock traded a total of 9,02,400 shares on NSE SME segment amounting to value of ₹1,661.86 lakhs on the first day.  The order book during the day showed a lot of buying with the buy orders consistently exceeding the sell orders at any point of time. That also led the stock to close with a minor bounce from the low point of the day. It must be noted here that Yudiz Solutions 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, Yudiz Solutions Ltd had a market capitalization of ₹187.71 crore with free-float market cap of ₹49.44 crore. It has a total of 103.19 lakh shares as the issued capital of the company. As stated earlier, since the trading is on the T2T segment, the entire volume of 9.02 lakh shares during the day is accounted for only by delivery trades.

Brief on the business model of Yudiz Solutions Ltd

Yudiz Solutions Ltd, is an SME IPO on the NSE which opened for subscription on 04th August 2023. The company, Yudiz Solutions Ltd, was incorporated in the year 2012 to offer IT solutions and consultancy services. It is not just positioned as a technology services company but also as a digital transformation company. Its areas of operations include mobile app development, game development, Blockchain, AR/VR web development, apart from the regular activities like website development, ecommerce set up, and portal development for the clients. Its blockchain and game app development businesses  are the most robust of the verticals it operates in.

Yudiz Solutions Ltd offers the array of IT solutions in Mobile, Web, AR/VR, UI/UX and IoT through integrating trending technologies. Its various platforms include News Platform, E-commerce Bidding Platform, On-Demand Services Platform, VR Training platform, Upskilling Industry specific VR platform, HR Intelligence platforms and many more. The company brings some advantages to the table like domain expertise, skilled team, an integrated one-stop solution offering and low attrition rates ensuring that there is continuity in its solution offerings. The fresh funds will be used by the company for acquisitions, new product development, networking, and brand building. Being in the knowledge industry, much of the outlay would be into intangibles. Narnolia Financial Services Ltd is the lead manager to the issue while MAS Services Limited is the registrar to the issue.