On Door Concepts IPO Lists with 2.88% Gain but dips below issue price

Premium listing for On Door Concepts Ltd, then dips sharply

On Door Concepts IPO had a flat to moderate listing on 01st November 2023, listing at a premium of 2.88%. However, after a very flat to moderate opening, the stock came under pressure and fell below the IPO issue price and also closed below the issue price for the listing day. For the day, the stock closed below the IPO issue price and the IPO listing price at the close of trading on 01st November 2023. What stood out was the way the performance of the stock wilted along with the negative trends in the market overall. On Wednesday, 01st November 2023, the Nifty closed 91 points in the red while the Sensex closed 283 points lower. In the last few days, the Nifty has been volatile but has managed to just hold about hold the 19,000 mark during the week. However, on Wednesday, the weakness in the market took the Nifty below the 19,000 mark. The weakness in the market was largely on account of the aggressive profit booking. It is not just the rise of geopolitical risk but the sharp spike in the US bond yields that is spooking the Indian markets, despite positive cues from the core sector data and the fiscal deficit situation.

How subscriptions impacted listing day performance

Let us now turn to the subscription story of On Door Concepts IPO. With very moderate subscription of 7.87X for the retail portion, and 3.16X for the HNI / NII portion; the overall subscription was extremely modest at 5.59X. The IPO was a fixed price issue with the IPO price fixed at ₹208 per share. The stock listed on a positive note at a premium of 2.88%, even on a day when the market sentiments were extremely weak overall. However, subsequently, despite the stock opening on the positive side for the day, it went on to close below listing price and also below the issue price on the first day of trading. This was reflective of the weak undertone of the stock amidst the broader global sentiments; which have been very weak of late. The subscription normally impacts the price discovery in book building issues and the listing price. In this case, being a fixed price issue, the impact was only felt in the stock price performance on the day of listing. In fact, on the day of listing, the stock failed to hold gains and closed sharply below the issue price and the listing price for the day on the NSE.

Stock closes Day-1 below issue price, after a modest start

Here is the pre-open price discovery for the On Door Concepts IPO on the NSE.

Data Source: NSE

The SME IPO of On Door Concepts Ltd was priced at ₹208 per share, based on the fixed pricing IPO method. On 01st November 2023, the stock of On Door Concepts Ltd listed on the NSE at a price of ₹214, a premium of 2.88% over the IPO issue price of ₹208 per share. However, in the midst of a volatile day post listing on 01st November 2023, the stock closed below the listing price and also below the IPO issue price. The stock had an upper circuit limit of ₹224.70 for the day and a lower circuit limit of ₹203.30 for the day. In the midst of the volatility in trading during the day, the stock hit the lower circuit and bounced back marginally, but stayed far away from the upper circuit price. The closing price reflects a weak day of trading, because it closed just above the lower circuit price for the day and well below the IPO issue price and the listing price. Also, the stock touching the lower circuit comes on a day when the stock actually opened at a premium, albeit very marginal. The Nifty was down 91  points and the Sensex was down 283 points in the day and that had an impact on the performance of the stock overall.

Being an SME IPO on the NSE, the stock of On Door Concepts Ltd 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 actually turned out to be the mid-point of the day. During the day, the stock hit the lower circuit and stayed far away from the upper circuit price. On the NSE, the stock of On Door Concepts Ltd 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 On Door Concepts IPO on listing day?

On Day-1 of listing i.e., on 01st November 2023, On Door Concepts Ltd touched a high of ₹218.00 on the NSE and a low of ₹203.30 per share. The low price of the day was exactly the lower circuit limit price of the stock while the stock high price of the day was well short of the upper circuit price of the stock. Between these two extreme prices, the stock was extremely volatile and eventually very near to the lower circuit price of the day. In fact, the stock can be said to have had a moderate listing and a weak close below the listing price and the IOP price on a day when the Nifty was down 91 points and the Sensex was down about 283 points.

Through a better part of the day, the stock stayed above the IPO issue price at most points of time although it hovered below the listing price of the day on several occasions, even touching the lower circuit briefly in the process. In terms of the circuit filter limits, the stock of On Door Concepts Ltd had an upper circuit filter limit of ₹224.70 and a lower circuit band limit of ₹203.30. The stock closed the day -1.68% below the IPO issue price of ₹208 per share and it also closed -4.44% below the listing price of the day of ₹214 per share. During the day, the stock of On Door Concepts Ltd hit the lower circuit but fell well short of the upper circuit before closing below the IPO issue price and the listing price of the day. The stock closed weak with no buyers and only sellers on 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.

Moderate volumes for On Door Concepts IPO on listing day

Let us now turn to the volumes of the stock on the NSE. On Day-1 of listing, the On Door Concepts Ltd stock traded a total of 3.27 lakh shares on NSE SME segment amounting to trading value (turnover) of ₹685.72 lakhs on the first day. The order book during the day showed a lot of selling at higher price levels with the sell orders consistently exceeding the buy orders at any point of time. That also led the stock to close with pending sell orders at the end of the trading session, although the price was volatile during the day. It must be noted here that On Door Concepts Ltd 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, On Door Concepts Ltd had a market capitalization of ₹115.51 crore with free-float market cap of ₹71.45 crore. It has a total of 56.49 lakh shares as the issued capital of the company. As stated earlier, since the trading is on the T2T segment, the entire volume of 3.27 lakh shares during the day is accounted by delivery trades only, barring some market trade exceptions in the market.