Mumbai: Stock market listings in the ongoing turbulent phase have not only become a dreaded dream for corporates planning to raise money from public, but are turning out to be inauspicious for the benchmark Sensex too, the recent trends on the bourses show.
An analysis of recent movements on the Bombay Stock Exchange's 30-share Sensex shows that in the past few months a new company gets listed in the market, the barometer index is most likely to plunge into the red.
More importantly, this trend has been followed even during the high-profit listings like Reliance Petroleum (RPL) and Sun TV.
While the two companies were listed at huge premiums over their issue prices, they still proved to be a bad omen for the benchmark Sensex.
RPL debuted on the BSE at a huge premium of nearly 70 per cent over its offer price of Rs 60 per share on May 11.
However, the Sensex registered a huge loss of 177 points that day, which marked the beginning of a sharp downslide on the bourses that pulled back the index to below the 8,800-point level from a peak of 12,671.11 on May 10.
Similarly, Sun TV debuted at a premium of nearly 27 per cent over its issue price of Rs 875 on April 24 when the market was still in its record-breaking bullish phase. But, the Sensex lost a whopping 268 points during Sun TV's debut trading session.
Situation has been even worse during the more recent listings, with a few exceptions like Allcargo Global Logistics, which was listed on June 23.
Since the beginning of May, the Sensex has settled in the positive territory in 21 trading sessions so far, while there have been only three occasions when the benchmark index has managed a positive ending on days when new shares have been listed on the bourses.
While Allcargo failed to recover above its issue price despite a sharp intra-day bounce back and closed marginally below its issue price of Rs 675 after listing at a huge discount, the benchmark Sensex managed to end the day with a 125-point gain after a volatile trading session.
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However, the Sensex lost as much as 461 points in a single day during the listings of Prime Focus, Deccan Aviation, Rathi Udyog and Unity Infraprojects earlier this month.
The Sensex lost 175 points on June 20 when Prime Focus made its debut, while a 461-point loss was recorded on June 8 when shares of Rathi Udyog were listed on the bourses.
The 30-share sensitive index fell over 334 points when Deccan Aviation and Unity Infrastructure got listed on June 12.
A total of five IPOs have been listed in the month of June so far, out of which Sensex managed to register a gain only on one occasion on 20 June when Allcargo was listed on the exchanges. However, the Sensex has closed with gains in eight trading sessions so far in June.
A similar trend was witnessed in the month of May when six companies made their debut out of which only in two cases - on May 3 and May 10 - the 30-share index registered one-day gains.
However, the Sensex had settled in positive territory in a total of 13 trading sessions during May, including the days when no new companies were listed on the bourses.
Besides RPL, the listings of Kamdhenu Ispat, Plethico Pharma and Lokesh Machines also saw the Sensex closing in the red.
Earlier this year, the Sensex had plunged 268 points on April 25 when Godawari Power and Ispat was listed on the BSE, while an 118-point fallers of Sakuma Exports and K Sera Sera were listed on the bourses.
Giving credence to the theory of new listings being ominous for the Sensex, a leading market analyst said that whenever a major listing happens on the bourses, the investors' attention tends to shift towards the new entrant
and some blue-chip counters end up bearing the brunt as was evident in the cases like RPL and Sun TV.
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