Indiabulls Power today joined the growing list of companies who failed to keep the investor interest during the issue on the first day of listing on the bourses. The company, which is backed by investments from UK-based billionaire LN Mittal's LNM India Internet Ventures and private equity firm Farallon, opened close to its issue price of Rs 45/share at BSE before lapsing to a lower level.
The stock, in which Indiabulls Real Estate holds the majority stake, dropped to as low as Rs 35 and is trading at Rs 41 about 10% lower than the issue price.
The company joins the likes of Adani Power and NHPC among other firms which saw poor investor response post listing over the last few months.
The 8% correction in the stock market over the last 10 days is believed to be one of the reasons for the poor run of Indiabulls Power on debut. As per an earlier analysis, domestic asset managers (read: mutual funds) had turned major sellers in the equity market over the past one month and have been net sellers worth over $1.2 billion in the October as against FIIs who have been buying although not aggressively.
This could also explain how Indiabulls Power scrip witnessing a selloff after the IPO saw 21 times oversubscription at the issue price just three weeks ago. Institutions were very bullish about the issue even as retail investors were not too interested in the IPO.