12 big-ticket IPOs leave investors high & dry as stocks crack 50-65% from highs

NEW DELHI: All that glitters is not gold! And the same has turned true for the big-ticket initial public offers (IPOs) that have hit Dalal Street over the last two years.

A quick analysis by ETMarkets.com shows that out of 41 IPOs with an issue size of over Rs 1,000 crore or more that flocked to primary markets to raise funds, over half are trading below listing prices and 18 below issue prices.

Among these 41 issues, some 12 IPOs have left a gaping hole in investors' pockets as they are down between 50-65% from their all-time high levels, suggesting the path to reclaiming past peaks could prove long and challenging amid current market turmoil.


Topping the losers' list are the known loss-making new-age tech stocks. PB Fintech, at the forefront, clocked over 67% fall from the high of Rs 1,470, shows data available from ACE Equity.

Following it, and a close second is Paytm's parent One97 Communications which is down 66.5% from an all-time high of Rs 1,961.05. Interestingly, the stock has never crossed the issue price and IPO investors are sitting with losses of 69%. The average broker target for Paytm suggests a 95% upside from current levels and for PB Fitech 46%.


Zomato, CarTrade Tech and Fino Payments Bank have lost 65.8%, 61.3% and 60%, respectively.

Most of these companies are a story of beautiful listings but later on, they could not give anything to investors, said Kranthi Bathini of Wealth Mills Securities.

"Predominantly, in most of these IPOs, what was left for investors was very less. The IPOs were fully priced in or overpriced as the promoters wanted to use the euphoric mood in the market and launch them at the peak of the market condition. Post that, following results and outlook, the euphoria fizzled out," Bathini added.

Krsnaa Diagnostics, IndiGo Paints, MedPlus Health, Nykaa, Glenmark Lifesciences and Chemplast Sanmar are the other seven names that are trading with deep cuts of over 50% each.

Commenting on the outlook for the IPO market, VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services told ETMarkets.com that the market situation is not favourable for the large IPOs and this space has been a mixed bag.

"Rightly-priced IPOs which leave something on the table for investors have done well and are trading at a good premium to issue prices. High-priced IPOs are unlikely to get a good response in the market," he added.

As global macro factors -- rising interest rates, Fed and ECB tapering of its QE and the situation in Europe due to the Ukraine war -- have affected the liquidity situation, investors are keen to look at companies with a proper path to profitability versus focusing only on growth in new-tech firms as most of their stocks have given no returns, said Amishi Kapadia, Executive Director and Global Head - Merchant Banking, YES Securities.

High OFS component in many IPOs with the existing holders exiting loss-making companies, fails to inspire confidence in public market investors, she added.

(Data Input: Ritesh Presswala, etmarkets.com)

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