Anil Dhirubhai Ambani Group shares crash

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Mumbai, Feb 11 (UNI) The scrips of Anil Dhirubhai Ambani Group (ADAG) today suffered a major setback due to lack of enthusiasm from investors in its new issue of Reliance Power Ltd over weak cues from global markets.

''Reliance Power was listed at Rs 430 as against the issue price of Rs 450 and closed at Rs 372. Earlier, it was trading at Rs 373.95 on Bombay Stock Exchange (BSE), a discount of 16.90 per cent over initial public offering (IPO) price of Rs 450. It made a debut at Rs 547.80, a premium of Rs 21.73 per cent from the IPO price. R-Power scrip dwindled by 17 per cent during the day. Volumes in the stock were high as 6.38 crore shares changed hands in the counter at BSE,'' brokers said.

Reliance Energy slumped too. All the sectoral indices on BSE, barring IT index, were in the red. Twenty-six out of 30 stocks from the Sensex pack were in the red. The market breadth was poor.

The current setback on the bourses has materialised despite a boost in liquidity in the secondary markets following investors getting back refunds of excess application money in the heavily subscribed Rs 11,000 crore Reliance Power IPO.

It, however, remains to be seen how much money from Reliance Power IPO refunds actually come to the secondary market in the light of immense volatility witnessed on the bourses last month.

Marketmen observed that it could be one of the worst to close low. While REPL slipped 17 per cent from its previous level, RPL was down 7.6 per cent. Reliance Energy was down 18.7 per cent, while Reliance Communications (RCom) fell by 8.9 per cent. It has touched an intra-day high of Rs 650 and an intraday low of Rs 600. It was trading with volumes of 884,990 shares. On Friday last, the share closed up 0.32 per cent or Rs 2.05 at Rs 646.10.

Marketmen had initially expected the price to double on debut, but the turmoil in stock market had lowered the risk appetite of investors, toning down their expectations subsequently. While the traders were expecting a premium of about Rs 75 to Rs 150 above the IPO price on debut, the Reliance Power IPO was subscribed 73 times.

Reliance Power, which was hovering near the Rs 400 level for major part of the day, slipped sharply in late trade, on fresh selling. It settled at Rs 372.50 on BSE, a discount of 17.22 per cent over IPO price of Rs 450. The stock made a debuted at Rs 547.80 on BSE, with a rise of 21.73 per cent over the IPO price. The stock hit a high and low of Rs 599.90 and Rs 355.05.

Retail investors were offered shares at Rs 430, that is, at a discount of Rs 20 per share. The counter saw huge volumes of 6.38 crore shares on BSE.

The current equity share capital of Reliance Power is Rs 2,259.82 crore. Face value per share is Rs 10. Despite getting an overwhelming response from investors for its IPO, the issue could get an aggregate commitment of over Rs 7.50 lakh crore as against the issue size of Rs 11,560 crore.

Reliance Energy (REL) and AAA Projects, a closely held promoter group company, hold equal stake of 45 per cent in Reliance Power.

Dashing the hopes of millions of domestic and global investors, Reliance Power Ltd made a below par debut at the BSE with a listed quote of Rs 430 per share.

Opening at Rs 20 less than the issue price of Rs 450, the much- hyped listing became a damp squib to investors as the Sensex opened lower for the week.

The largest-ever Indian IPO, Reliance Power had a negative opening mainly due to weak overseas market and the growing concern over the sluggish growth of the US economy.

However, gains in the index heavy weight ICICI Bank supported the indices at lower level.

Before the trading, the listing ceremony of Reliance Power was held at the convention hall of the BSE, with its Chairman Anil Ambani striking the bell to mark the first trading.

The market was abuzz overnight with an expectations of the most prestigious scrip hitting around Rs 600 at listing. It began touching a high of Rs 530 in early trade, but a huge sell, pulled down the stock to an intra-day low of Rs 386. It was trading lower at Rs 427.70, down Rs 22.30 or five per cent on the National Stock Exchange (NSE). The traded volumes of 29,48,67,000 shares and the turnover was at Rs 1260 crore.

The company had entered capital market with public issue of 26 crore equity shares of Rs 10 each. Reliance Power IPO was oversubscribed approximately 70 times.

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