EPACK Durables IPO Lists -3.91% lower, falls further

EPACK Durable IPO had a weak listing on 30th January 2024, listing at a discount of -3.91% to the issue price, and falling further form the listing price. While the closing price on 30th January 2024 was below the IPO issue price for the day, it also closed below the listing price of the IPO. For the day, the Nifty closed 216 points lower while the Sensex closed a full 802 points lower. Both the Nifty and the Sensex stayed under pressure through the day and the Sensex has now lost nearly 2,000 points in the last 6 trading session with the Nifty falling sharply towards the 21,500 levels, as the selling intensified.

IPO subscription and pricing details

The stock had seen a relatively strong subscription in the IPO. The subscription was 16.79X  overall and QIB subscription was at 25.59X. In addition, the retail portion had got subscribed 6.50X in the IPO while the HNI / NII portion also got a healthy subscription of 29.07X. Hence the listing was expected to be fairly strong for the day. However, the listing performance got marred by the weakness in the market with the Nifty falling by 216 points in the day and the Sensex losing 802 points in the day. However, despite the weakness in the market, the stock of EPACK Durable IPO did not lose too much of value on the listing day. Here is the EPACK Durable Ltd listing story on 30th January 2024.

The IPO price of EPACK Durable Ltd was fixed at the upper end of the band at ₹230 which was anyways along expected lines considering the relatively modest to strong subscription in the IPO. The anchor investment allocation had also happened at ₹230 per share. The price band for the IPO was ₹218 to ₹230 per share. On 30th January 2024, the stock of EPACK Durable Ltd listed on the NSE at a price of ₹221, a discount of -3.91% on the IPO issue price of ₹230 per share. On the BSE also, the stock listed at ₹225, a discount of -2.17% on the IPO issue price of ₹230 per share.

How the stock of EPACK Durable IPO closed on both exchanges

On the NSE, EPACK Durable Ltd closed on 30th January 2024 at a price of ₹208.15 per share. That is a first day closing discount of -9.50% on the issue price of ₹230 and also a discount of -5.81% on the listing price of ₹221 per share. In fact, the closing price of the day turned out to lower than the listing price of the day and the stock closed the day very near to the low price of the day. On the BSE also, the stock closed at ₹207.70. That represents a first day closing discount of -9.70% on the IPO issue price of ₹230 per share and also represents a discount of -7.69% on the listing price on the BSE of ₹225 per share. On both the exchanges, the stock listed below the IPO issue price and also lost further ground at the close of Day-1. The opening price of the day was pretty close to the high price of the day while the closing price of the day was quite close to the low price of the day, underlining a very weak sentiment on the stock on listing day on 30th January 2024. The fall was also impacted by the fact that the markets were very volatile on the NSE and on the BSE during the day. The high price and the low price did betray a lot of volatility in the stock price, although both these prices were well away from the 20% circuit filters applicable to the stock of EPACK Durable Ltd on the day of listing i.e., 30th January 2024.

Price volume story of EPACK Durable IPO on the NSE

The table below captures the opening price discovery in the pre-open period on the NSE.

Data Source: NSE

Let us look at how the stock traversed on the National Stock Exchange (NSE) on 30th January 2024. On Day-1 of listing, EPACK Durable Ltd touched a high of ₹224.50 on the NSE and a low of ₹206.20 per share. The discount to the listing price sustained through most part of the day while the stock never went even close to the IPO issue price at any point during the trading session. The high and low price range does tell a lot about the volatility during the day, although the prices stayed well clear of the circuit filters. Mainboard IPOs do not have an upper or lower circuit of 5%, unlike SME IPOs since they trade in the normal equity segment and not in the trade to trade segment.

However, the stock of EPACK Durable Ltd was subjected to 20% circuit filter on either. That translated into an upper circuit price of EPACK Durable Ltd on the NSE at ₹265.20 and a lower circuit price of the stock at  ₹176.80 per share. On the NSE, the high price of the day at ₹224.50 was well short of the upper circuit price of ₹265.20 while the low price of the day at ₹206.20 was also well above the lower circuit price of ₹176.80. On Day-1 of listing, the EPACK Durable Ltd stock traded a total of 117.13 lakh shares on NSE amounting to value of ₹253.44 crore during the day.  The order book during the day showed a lot of back and forth with the bias clearly in favour of the sellers, with serious buying emerging towards the end. The stock closed the day with pending buy orders of 2,883 shares on the NSE.

Price volume story of EPACK Durable IPO on the BSE

Let us look at how the stock traversed on the Bombay Stock Exchange (BSE) on 30th January 2024. On Day-1 of listing, EPACK Durable Ltd touched a high of ₹225 on the BSE and a low of ₹205.70 per share. The discount to the listing price sustained through most part of the day while the stock never went even close to the IPO issue price at any point during the trading session. The high and low price range does tell a lot about the volatility during the day, although the prices stayed well clear of the circuit filters. Mainboard IPOs do not have an upper or lower circuit of 5%, unlike SME IPOs since they trade in the normal equity segment and not in the trade to trade segment.

However, the stock of EPACK Durable Ltd was subjected to 20% circuit filter on either. That translated into an upper circuit price of EPACK Durable Ltd on the BSE at ₹269.95 per share and a lower circuit price of the stock at  ₹180 per share. On the BSE, the high price of the day at ₹225 per share was well short of the upper circuit price of ₹269.95 per share, while the low price of the day at ₹205.70 per share was also well above the lower circuit price of ₹180 per share. On Day-1 of listing, the EPACK Durable Ltd stock traded a total of 12.76 lakh shares on BSE amounting to value of ₹27.82 crore during the day.  The order book during the day showed a lot of back and forth with the bias clearly in favour of the sellers, with serious buying emerging towards the end. The stock closed the day with pending buy orders of on the BSE also.

Market capitalization, free float, and delivery volumes

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 with buying emerging in the final part of the trading session. The sharp correction in the Nifty and the Sensex really did not deter the stock too much as it fell only marginally below the issue price and the listing price. That makes it a rather attractive stock after being able to hold its own on tough listing day. On the NSE, out of the total 117.13 lakh shares traded during the first day of trading, the deliverable quantity represented 65.34 lakh shares or a deliverable percentage of 55.70% on the NSE, which is higher than the routine listing day median on the NSE.

That shows a fair level of speculative action on the counter. Even on the BSE, out of the total 12.76 lakh shares of quantity traded, the deliverable quantity at a gross across client level was 6.89 lakh shares representing total deliverable percentage of 53.97%, which is at par with the delivery ratio on the NSE. Unlike the SME segment stocks, which are on T2T on the day of listing, the mainboard IPOs permit intraday trading even on the day of listing.

At the close of Day-1 of listing, EPACK Durable Ltd had a market capitalization of ₹1,989.74 crore with free-float market cap of ₹616.82 crore. EPACK Durable Ltd has issued capital of 957.99 lack shares with a face value of ₹10 per share. The stock trades on the NSE main segment under the trading code (EPACK) and will be available in the demat account under ISIN code (INE0G5901015).

IPO size to Market cap contribution ratio

One way to assess the significance of the IPO on the market cap of the segment is the ratio of market capitalization overall to the IPO size. EPACK Durable Ltd had a market cap of ₹1,989.74 crore and the issue size was ₹640.05 crore. Therefore, the Market cap contribution ratio of the IPO works out to 3.11 times; which is relatively low for an IPO. Remember, this is not the ratio of the market cap to original book value, but the ratio of the market cap created to the size of the IPO. That shows the significance of the IPO to the overall market cap accretion of the stock exchange.