Debuting scrips in the green

Both IPOs listed in the week were trading in the green compared to their IPO prices.

Two scrips were listed on the BSE during the week ended 23 February 2007. One was a BPO firm, Firstsource Solution, while the other to the power sector public financial institute, Power Finance Corporation. By 23 February 2007, both were trading higher than their IPO prices.

Of the two newly-listed companies, Power Finance Corporation surged the most, 30.76% to Rs 111.15, by 23 February 2007 compared with the IPO price of Rs 85. The stock clocked an average daily volume of 4.06 crore shares since the day of debut. The scrip was listed on the BSE at Rs 104.

Firstsource Solution rose 22.46% to Rs 80.05 by 23 February 2007, compared with the IPO price of Rs 65 on 22 February 2007. The stock clocked an average daily volume of 1.99 crore shares from the date of debut. The IPO was listed on the BSE at Rs 75.10.

During the period under consideration, the market declined amid high volatility. Factors like the CRR-hike, rising inflation, concern over rising domestic interest rates, unwinding in derivatives ahead of expiry of February 2007 contracts on 22 February 2007, and fear that short-term capital gains tax may be hiked in the Union Budget 2007-08, were the major triggers for the fall. Caution was also partly due to worries of a possible interest rate hike by the Bank of Japan (BoJ), which was raised to 0.50% on 22 February 2007.

The BSE Sensex shed 723.02 points for the week ended 23 February 2007, to settle at 13,632.53 compared with the previous week’s closing of 14,355.55 on 15 February 2007. The S&P CNX Nifty lost 207.30 points, to settle at 3,938.90 compared with the previous week’s closing at 4,146.20.