Concord Biotech IPO lists at 21.46% premium, rallies higher

Robust listing for Concord Biotech on a dull day

Concord Biotech Ltd had a very robust listing on 18th August 2023, listing at a smart premium of 21.46%, and rallying higher from the listing price. The closing price on 18th August 2023 was not only above the issue price but also above the listing price. In short, the rally was quite sharp even after a premium listing and represented a good spike from the opening price. In a sense the stock opened strong and also rallied sharply higher during the day and also closed at a substantial premium to the listing price.

What is more interesting is the fact that the strong listing performance by Concord Biotech Ltd came on a day when the markets were lacklustre overall. In fact, on 18th August 2023, the NSE fell by 55 points and the BSE Sensex fell by 202 points. The Nifty closed near to the 19,300 levels after getting close to 20,000 at one point of time. Both the Nifty and the Sensex closed the day week, but the stock of Concord Biotech Ltd was not really perturbed by the market conditions.

Despite the tepid market conditions, the stock picked up momentum during the day and showed a lot of traction in trading on the first day of listing. The stock had seen strong subscription in the IPO. The subscription was 24.87X  overall and QIB subscription was at 67.67X. Hence the listing was expected to be fairly strong. However, while the listing was strong, the performance strength got reinforced during the trading day. However, it must be said that despite the tepid conditions in the overall market, the stock managed to sustain its upward momentum and close at a substantial premium to the IPO price as well as to the listing price for the day. Here is the Concord Biotech Ltd listing story on 18th August 2023.

IPO subscription and pricing details

The IPO price was fixed at the upper end of the band at ₹741 which was anyways along expected lines considering the extremely strong 24.87X overall subscription and the 67.67X QIB subscription in the IPO. In addition, the retail portion had got subscribed 3.78X in the IPO while the HNI / NII portion also got a healthy subscription of 16.99X. The price band for the IPO was ₹705 to ₹741.

On 18th August 2023, the stock of Concord Biotech Ltd listed on the NSE at a price of ₹900.05, a very strong premium of just 21.46% over the IPO issue price of ₹741. On the BSE also, the stock listed at ₹900.05, a premium of just 21.46% over the IPO issue price of ₹741 per share. It was a similar opening on both the exchanges.

How the stock of Concord Biotech IPO closed on both exchanges

On the NSE, Concord Biotech IPO closed on 18th August 2023 at a price of ₹943.50. That is a first day closing premium of 27.33% on the issue price of ₹741 and also a premium of 4.83% on the listing price of ₹900.05. In fact, the listing price turned out to be the low price of the day and the stock traded for the entire trading day above the opening listing price. On the BSE, the stock closed at ₹941.85. That represents a first day closing premium of 27.11% above the IPO issue price and also a premium of 4.64% above the listing price on the BSE. On both the exchanges, the stock listed strongly above the IPO issue price and also managed to close Day-1 after rallying much higher.

In fact, the opening price turned out to be the low price of the day on both the exchanges. The high price of the day was of course fairly above the closing price on both the exchanges, which could be attributed to some late profit taking in the counter. Clearly, despite the weak performance of the markets overall, the stock of Concord Biotech almost appeared to be insular and unperturbed. It had little impact on the stock on 18th August 2023 allowing the stock to close the day well above the issue price for the day. In short, the tepid conditions in the market did not deter the stock from sustaining its morning gains, and not only sustain the gains on listing, but also close well above the listing price.

Price volume story on the NSE

Let us look at how the stock traversed on the National Stock Exchange (NSE) on 18th August 2023. On Day-1 of listing, Concord Biotech Ltd touched a high of ₹987.70 on the NSE and a low of ₹900.05. The premium to the listing price sustained through the day, although the stock did not manage to hold on to the high price of the day. Mainboard IPOs also do not have any upper or lower circuit filter of 5%, unlike SME IPOs. If you look at the range of prices, the stock opening price turned out to be the low point of the day while the closing price of the day was well below the high price due to some late selling on the stock. The strong post-listing performance of the IPO stock was despite the tepid conditions in the overall markets with the Nifty losing value during the day.

On Day-1 of listing, the Concord Biotech Ltd stock traded a total of 242.49 lakh shares on NSE amounting to value of ₹2,242.97 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 buyers. The stock closed the day with pending sell orders of 403 shares on the NSE, which could be attributed to the late selling. The table below captures the opening price discovery in the pre-open period on the NSE.

Data Source: NSE

Price volume story on the BSE

Let us look at how the stock traversed on the Bombay Stock Exchange (BSE) on 18th August 2023. On Day-1 of listing, Concord Biotech Ltd touched a high of ₹987.05 on the BSE and a low of ₹900.00. The premium to the listing price sustained through the day, although the stock did not manage to hold on to the high price of the day. Mainboard IPOs also do not have any upper or lower circuit filter of 5%, unlike SME IPOs. If you look at the range of prices, the stock opening price turned out to be the low point of the day while the closing price of the day was well below the high price due to some late selling on the stock.

The strong post-listing performance of the IPO stock was despite the tepid conditions in the overall markets with the Nifty losing value during the day. On Day-1 of listing, the Concord Biotech Ltd stock traded a total of 15.45 lakh shares on BSE amounting to value of ₹143.58 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 buyers. The stock closed the day with pending sell orders, which could be attributed to the late selling.

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 broadly the same. The order book through the day showed a lot of strength and that almost sustained till the close of the trading session on the first day of trading. The sharp fall in the Nifty and the Sensex from higher levels did not deter the stock from staying robust, although it led to some selling in the last hour. That makes it a rather attractive stock after the strong listing on Friday.

On the NSE, out of the total 242.49 lakh shares traded during the first day of trading, the deliverable quantity represented 111.81 lakh shares or a deliverable percentage of 46.11% on the NSE, which is around the routine listing day median. That shows a lot of delivery action in the counter. Even on the BSE, out of the total 15.45 lakh shares of quantity traded, the deliverable quantity at a gross across client level was 7.03 lakh shares representing total deliverable percentage of 45.54%, marginally below the delivery action 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, Concord Biotech Ltd had a market capitalization of ₹9,853.28 crore with free-float market cap of ₹1,379.46 crore. Concord Biotech Ltd has issued capital of 10.46 crore shares with a face value of ₹1 per share.

Brief on Concord Biotech business model

Concord Biotech Ltd, a company backed by the late Rakesh Jhunjhunwala, is a R&D driven biopharma company. The company is principally into the manufacture of Active Pharmaceutical Ingredients (API) via fermentation and semi-synthetic processes. It is also into the manufacture of finished formulations. The company has gradually transformed from being a single-product company to a wide-spectrum solution provider. It currently offers products across diversified therapeutic segments.

Currently, Concord has an established presence in 70 countries worldwide with distribution set-ups in place in the US, Europe, Japan, Latin America, Africa, and Asia. It also has a significant presence in the domestic market.  The company is currently partnering with leading global pharma giants to meet their product development needs for APIs and formulations. It has 3 manufacturing facilities comprising of 2 API manufacturing units and one finished formulation unit.