Orient Cables shares plunged 10 per cent to hit the lower circuit at Rs 364.50 on Tuesday, extending losses a day after a blockbuster stock market debut.
While the stock remains significantly above its IPO issue price, it has shed nearly one-fifth of its value from the listing price as investors booked profits following the sharp listing gains.
The stock had debuted at Rs 450 on the National Stock Exchange (NSE) on Monday, reflecting a premium of around 65 per cent over its IPO issue price of Rs 272 per share. After a strong start, the stock closed its listing day at Rs 405.
On Tuesday, selling pressure intensified, dragging the share price down to Rs 364.50. At this level, the stock was down 10 per cent from its previous close and nearly 19 per cent below its NSE listing price.
Despite the correction, Orient Cables continues to trade about 34 per cent above its IPO issue price.
Orient Cables is a business-to-business (B2B) manufacturer focused on networking cables and passive networking equipment. The company serves several high-growth sectors, including telecommunications, broadband infrastructure, data centres, renewable energy, smart building automation, fast-moving electrical goods (FMEG), automotive and e-mobility.
The company also has an international footprint, exporting its products to multiple overseas markets such as the UAE, Qatar, the US, Australia, New Zealand, Nepal, Singapore and the Netherlands.
The company had launched its Rs 552-crore initial public offering between September 25 and September 29. The issue comprised a fresh issue of Rs 320 crore and an offer for sale of Rs 232 crore. The IPO was priced in the range of Rs 258-272 per share.
Investor demand for the issue was exceptionally strong. The IPO was subscribed 97.28 times overall, with qualified institutional buyers (QIBs) bidding 192.68 times the shares reserved for them.
The non-institutional investor (NII) portion was subscribed 121.90 times, while the retail investor category saw a subscription of 32.21 times.
The shares were allotted on September 30 and listed on both the NSE and BSE on October 5. On listing day, the stock opened at Rs 450 on the NSE and Rs 448 on the BSE, delivering handsome gains to IPO investors.
