WTI Cabs IPO Lists 32.65% higher, hits upper circuit

Robust listing for Wise Travel India (WTI Cabs) IPO, then upper circuit

Wise Travel India (WTI Cabs) IPO had a robust listing on 19th February 2024, listing at a premium of 32.65%. After a strong opening, the stock closed the day at the 5% upper circuit over the listing price, with the opening listing price turning out to be the low price of the day. For the day, the stock closed comfortably above the IPO issue price and the IPO listing price at the close of trading on 19th February 2024. What also stood out about the stock was the robust listing despite the volatility in the markets overall. However, it must be said that on the day of listing, the Nifty had eventually shown strength gaining 826 points and the Sensex was up by 282 points. In the last few days, the Nifty has been volatile but has managed to hold the 22,000 mark during the week and that is what matters to the market.

While the stock markets did close in the positive during the day, there was a good deal of volatility. Volumes were subdued because Monday happens to be a bank and clearing holiday in India on account of Shivaji Jayanti, although the stock markets were functioning. Also, global investors had a lower presence on Monday, as it happens to be a holiday in the US markets on account of George Washington Memorial Day. The overall volumes in the markets were not too intense, that that allowed the markets to stay afloat at higher levels, despite the volatility through the day.

Subscription and price performance of Wise Travel India (WTI Cabs) IPO on listing day

Let us now turn to the subscription story of Wise Travel India (WTI Cabs) IPO. With robust subscription of 108.76X for the retail portion, 106.69X for the QIB portion, and 375.56X for the HNI / NII portion; the overall subscription was extremely healthy at 163.46X. The IPO was a book building IPO issue with the IPO price band set in the range of ₹140 to ₹147  per share. Being a book built issue and getting such solid subscription numbers, the stock obviously ended being priced at the upper end of the price band. The stock listed at a strong premium of 32.65% on the NSE SME segment.

However, subsequently, despite the stock seeing some volatility in the early parts of the day, it went on to close at the upper circuit of 5% over the listing price. This was reflective of strength in the stock amidst the volatile market sentiments. The subscription normally impacts the price discovery in book building issues and the listing price. The strong subscription had a positive impact on the ability of the stock  in 3 ways. Firstly, it ensured that the price discovery of the book built issuer happened at the upper end of the price band at ₹147 per share. Secondly, it led to the stock price listing at a robust premium to the issue price. Thirdly, despite the pressure on the overall market, the stock managed to close at the 5% upper circuit for the day, which is a sign of inherent strength in the stock.

Stock closes Day-1 at upper circuit, after a bumper listing start

Here is the pre-open price discovery for the SME IPO of Wise Travel India (WTI Cabs) IPO on the NSE.

Data Source: NSE

The SME IPO of Wise Travel India Ltd (WTI Cabs) was a book built IPO and priced at ₹147 per share; which is the upper end of the price band of the IPO. On 19th February 2024, the stock of Wise Travel India Ltd (WTI Cabs) listed on the NSE at a price of ₹195 per share, a premium of 32.65% over the IPO issue price of ₹147 per share. However, despite a volatile day post listing on 19th February 2024, the stock of Wise Travel India Ltd (WTI Cabs) closed exactly at the upper circuit price of ₹204.75 per share on the NSE SME segment. The stock had an upper circuit limit of ₹204.75 for the day and a lower circuit limit of ₹185.25 per share for the day. In the midst of the volatility in trading during the day, the stock hit the upper circuit but stayed put at the upper circuit price for the better part of the day.

However, the stock never went below the listing price of the day, which was also the low price of the day at ₹195 per share. The stock was, obviously, quite far away from the lower circuit price of the day. The stock showed a smart bounce from listing levels as it spent better part of the day locked in upper circuit. The closing price reflects a strong day of trading, because it closed at the upper circuit and never went below the listing price, and it remained well above the lower circuit limit for the day. Also, the upper circuit comes on top of a 32.65% premium listing of the stock, on a day when the stock markets were volatile with a positive bias. The Nifty had gained 82 points while Sensex was up 282 points on the day. Overall, the closing price of the stock of Wise Travel India Ltd (WTI Cabs) was a full 39.29% above the issue price on the first day of the stock listing on the NSE SME segment.

Listed in the ST segment for trade in T2T

Being an SME IPO on the NSE, the stock of Wise Travel India Ltd (WTI Cabs) was subjected to 5% circuit filter on listing day and was also in the ST (trade to trade) segment. That means, only delivery trades are permitted on the stock. 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. The opening price of the day was exactly at the low price of the day, meaning the stock never really dipped below the listing price and spent most part of the day at the upper circuit, locked in.

During the day, the stock hit the upper circuit but stayed well above the lower circuit. In fact, the stock did not even dip below the listing price and the close was exactly at the upper circuit price. In fact, the stock never went below the listing price and stayed well above the lower circuit price of the day. On the NSE, the stock of Wise Travel India Ltd (WTI Cabs) has been admitted to trade in the ST category. The ST category is specifically for the SME Emerge segment of the NSE with compulsory trade to trade settlement. On such stocks, netting of positions is not permitted and every trade has to be settled by delivery only.

How prices traversed for Wise Travel India (WTI Cabs) IPO on listing day

On Day-1 of listing i.e., on 19th February 2024, Wise Travel India Ltd (WTI Cabs) touched a high of ₹204.75 per share on the NSE and a low of ₹195 per share. The high price of the day was exactly the upper circuit limit price of the stock while the stock low price of the day was exactly at the listing price of the day. Between these two extreme prices, the stock was relatively less volatile and eventually closed at the upper circuit price of the day; where it actually spent most of the trading day. In fact, the stock actually enjoyed a strong listing and despite the Nifty and the Sensex showing bouts of volatility during the day, the stock of Wise Travel India Ltd (WTI Cabs) closed at 5% upper circuit on top of a premium listing on the NSE. The stock also spent most of the day locked at upper circuit.

During the trading day, the stock never really went below the listing price of ₹195 per share, which was the low price of the day and stayed well clear of the lower circuit price of ₹185.25 per share. The stock quickly bounced and got locked into the upper circuit price of the day. In terms of the circuit filter limits, the stock of Wise Travel India Ltd (WTI Cabs) had an upper circuit filter limit of ₹204.75 and a lower circuit band limit of ₹185.25. The stock closed the day 39.29% above the IPO issue price of ₹147 per share and it also closed 5% above the listing price of the day at ₹195 per share. During the day, the stock of Wise Travel India Ltd (WTI Cabs) hit the upper circuit and stayed locked in the upper circuit for most part of the day. However, it never really dipped below the listing price and so, obviously stayed well above the lower circuit price of the day. The stock closed strong at the upper circuit at the close of the day with pending buy orders of 14,000 shares and no sellers in the counter. For the SME IPOs, it may be recollected, that 5% is the upper limit and also the lower circuit on the listing price on the day of listing.

Robust volumes for Wise Travel India (WTI Cabs) IPO on listing day

Let us now turn to the volumes of the stock on the NSE. On Day-1 of listing, the Wise Travel India Ltd (WTI Cabs) stock traded a total of 25.61 lakh shares on NSE SME segment amounting to trading value (turnover) of ₹5,119.70 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 pending buy orders of 14,000 shares at the end of the trading session, although the price was hardly volatile during the day. It must be noted here that Wise Travel India Ltd (WTI Cabs) 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, Wise Travel India Ltd (WTI Cabs) had a market capitalization of ₹487.55 crore with free-float market cap of ₹147.44 crore. It has a total of 238.12 lakh shares as the issued capital of the company with a face value of ₹10 per share. As stated earlier, since the trading is on the T2T segment, the entire volume of 25.61 lakh shares during the day is accounted by delivery trades only, barring some market trade exceptions in the market. The stock trades on the NSE SME segment under the trading code (WTICAB) and will be available in the demat account under ISIN code (INE623Y01011).

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 overall to the IPO size. Wise Travel India Ltd (WTI Cabs) had a market cap of ₹487.55 crore and the issue size was ₹94.68 crore. Therefore, the Market cap contribution ratio of the IPO works out to 5.15 times; which is lower than the median for SME IPOs on the NSE. 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.