Rashi Peripherals IPO Lists at 9.16% premium; tapers later

Strong listing for Rashi Peripherals IPO, but tapers later

Rashi Peripherals IPO had a moderate to strong listing on 14th February 2024, listing at a premium of 9.16%, but it failed to hold on to the listing gains and tapered towards the close of trade on 14th February 2024. While the closing price on 14th February 2024 was surely above the IPO issue price for the day, it closed below the listing price of the IPO. For the day, the Nifty closed 97 points higher while the Sensex closed a full 268 points higher. Both the Nifty and the Sensex started weak, but recovered sharply in the second half of the trading session and closed higher despite sharp bouts of volatility. The post-listing weakness in the price of Rashi Peripherals IPO on the day of listing was more a direct outcome of weak opening of the market. However, as we shall see later, the price of Rashi Peripherals Ltd actually gave up gains during the day.

IPO subscription and pricing details for Rashi Peripherals Ltd

The stock had seen a strong subscription in the IPO. The subscription was 62.95X  overall and QIB subscription was at 151.45X. In addition, the retail portion had got subscribed 11.01X in the IPO while the HNI / NII portion also got a healthy subscription of 66.15X. Hence the listing was expected to be fairly strong for the day. However, while the listing was strong, the post listing performance was really not up to the mark. Remember, the circuit filter for most mainboard IPOs is kept at 20% above and below the listing price of the day on the day of listing. In the case of Rashi Peripherals Ltd, the strong subscription allowed price discovery at the upper end of the band and got a good listing, but the close was less than satisfactory. Here is the Rashi Peripherals Ltd listing story on 14th February 2024.

The IPO price was fixed at the upper end of the band at ₹311 per share which was anyways along expected lines considering the relatively strong subscription in the IPO. The price band for the IPO was ₹295 to ₹311 per share. On 14th February 2024, the stock of Rashi Peripherals Ltd listed on the NSE at a price of ₹339.50 per share, a modest to strong premium of 9.16% above the IPO issue price of ₹311 per share. On the BSE also, the stock listed at ₹335 per share, a premium of 7.72% over the IPO issue price of ₹311 per share.

How the stock of Rashi Peripherals Ltd closed on both exchanges

On the NSE, Rashi Peripherals Ltd closed on 14th February 2024 at a price of ₹320.60 per share. That is a first day closing premium of a modest 3.09% on the issue price of ₹311 per share. However, it marks a discount of -5.57% below the listing price of ₹339.50 per share. In fact, the listing price turned out to be closer to the high price of the day and the stock traded almost for the entire trading day below the opening listing price. On the BSE also, the stock closed at ₹320.55 per share. That represents a first day flat closing on the IPO issue price of ₹311 per share. However, the closing price for the day was at a discount of -4.31% on the listing price on the BSE at ₹335 per share. On both the exchanges, the stock listed strongly above the IPO issue price and also managed to close Day-1 above the IPO issue price. However, the pressure of selling was visible on the counter in both the stock exchanges. On both the stock exchanges, the stock remained in a narrow range, but ended the day closer to the low price of the day, as the listing price of the day was closer to the high price of the day. In short, the stock remained under pressure.

Remember, that the company is subject to 20% circuit filters on both side. The upper circuit filter on the NSE was ₹407.40 per share while the lower circuit price on the NSE was ₹271.60 per share. In comparison, the high price of the day at ₹342.70 per share was much below the upper circuit price. Even the low price of the day at ₹318 per share was much above the lower circuit limits for the day. However, what stood out about the stock was the tapering of the stock from higher levels, after opening at a modest to strong premium.

Price volume story on the NSE

The table below captures the opening price discovery in the pre-open period on the NSE.

Data Source: NSE

Let us look at how the stock traversed on the National Stock Exchange (NSE) on 14th February 2024. On Day-1 of listing, Rashi Peripherals Ltd touched a high of ₹342.70 per share on the NSE and a low of ₹318 per share. The premium to the IPO price sustained through but the premium to the listing price could not really be sustained and it turned into discount to listing price. While the stock was volatile during the day, what stood out about the performance on the exchange during the day was the tapering of the stock price after a modest to strong opening. Mainboard IPOs do not have an upper circuit of 5%, unlike SME IPOs since they trade in the normal equity segment and not in the trade to trade segment. However, on listing day, this IPO was subjected to the standard 20% upper and 20% lower circuit limit, which was the case with Rashi Peripherals Ltd.

The High Price of the day at ₹342.70 per share was well below the upper circuit price of ₹407.40 per share. Similarly, the Low Price of the day at ₹318 per share was well above the lower circuit price of ₹271.60 per share. On Day-1 of listing, the Rashi Peripherals Ltd stock traded a total of 154.53 lakh shares on NSE amounting to value of ₹511.81 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 sellers, with serious selling emerging towards the end. The stock closed the day with pending unfulfilled sell orders of on the NSE to the tune of 37,799 shares.

Price volume story on the BSE

Let us look at how the stock traversed on the Bombay Stock Exchange (BSE) on 14th February 2024. On Day-1 of listing, Rashi Peripherals Ltd touched a high of ₹342.50 per share on the BSE and a low of ₹317.80 per share. The premium to the IPO price sustained through but the premium to the listing price could not really be sustained and it turned into discount to listing price. While the stock was volatile during the day, what stood out about the performance on the exchange during the day was the tapering of the stock price after a modest to strong opening. Mainboard IPOs do not have an upper circuit of 5%, unlike SME IPOs since they trade in the normal equity segment and not in the trade to trade segment. However, on listing day, this IPO was subjected to the standard 20% upper and 20% lower circuit limit, which was the case with Rashi Peripherals Ltd.

The High Price of the day at ₹342.50 per share was well below the upper circuit price of ₹384.65 per share. Similarly, the Low Price of the day at ₹317.80 per share was well above the lower circuit price of ₹256.45 per share. On Day-1 of listing, the Rashi Peripherals Ltd stock traded a total of 14.11 lakh shares on BSE amounting to value of ₹46.76 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 sellers, with serious selling emerging towards the end. The stock closed the day with pending unfulfilled sell orders on the BSE too.

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 the same. The order book through the day showed a lot of pressure and that almost sustained till the close of trading session. Despite the late bounce in the Nifty and the Sensex, the stock of Rashi Peripherals Ltd could not sustain these gains. However, it must be said that amidst the sharp bounce in the market, the stock of Rashi Peripherals actually came under pressure and closed near the low price of the day. On the NSE, out of the total 154.53 lakh shares traded during the first day of trading, the deliverable quantity represented 81.31 lakh shares or a deliverable percentage of 52.62% on the NSE, which is well above the routine listing day median. That shows fairly high delivery action in the counter. Even on the BSE, out of the total 14.11 lakh shares of quantity traded, the deliverable quantity at a gross across client level was 7.19 lakh shares representing total deliverable percentage of 50.94%, which is at par with the ration on the NSE and also in line with the median on the BSE. 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, Rashi Peripherals Ltd had a market capitalization of ₹2,112.41 crore with free-float market cap of ₹422.48 crore. Rashi Peripherals Ltd has issued capital of 659.00 lakh shares with a par value of ₹5 per share. The stock is traded on the NSE under the trading symbol (RPTECH), it is traded on the BSE under the trading code (544119) and the shares are held in demat account vide ISIN Number (INE0J1F01024).