Marinetrans India IPO lists 15.38% higher and hits upper circuit

Premium listing for Marinetrans India IPO, then upper circuit

Marinetrans India IPO had a relatively strong listing on 08th December 2023, listing at a premium of 15.38%. After a relatively strong  opening, the stock closed the day at the 5% upper circuit over the listing price. For the day, the stock closed comfortably above the IPO issue price and the IPO listing price at the close of trading on 08th December 2023. What also favoured the performance of the stock was the market support with the Nifty and the Sensex gaining smartly during the day.

On 08th December 2023, the Nifty closed 68 points higher while the Sensex closed 304 points higher. In the last few days, the Nifty has been volatile but has managed to traverse the 20,000 and the 20,500 mark with ease and is now almost at the threshold of crossing the 21,000 levels. This is psychological level where the Nifty is facing some pressure, but that is par for the course after a rally that has lasted more than 1,300 points on the Nifty. A mix of domestic and global favourable cues have led to a sharp rerating of the Nifty and the Sensex with the RBI policy adding to the momentum.

Subscription and price performance of Marinetrans India IPO on listing day

Let us now turn to the subscription story of Marinetrans India IPO on the listing day. With relatively robust subscription of 47.24X for the retail portion, and 18.05X for the HNI / NII portion; the overall subscription was extremely healthy at 33.00X. The IPO was a fixed price IPO issue with the IPO price already being fixed at ₹26 per share. Thanks to the robust response to the IPO, the stock got a favourable listing on Friday, the 08th December 2023. The stock listed at a fairly robust premium of 15.38%.

However, subsequently, despite the stock seeing some volatility in the early parts of the day, it went on to close at the upper circuit of 5% over the listing price. Interestingly, the stock also touched the lower circuit during the day at ₹28.50 per share and also was locked in at that price for some time before the stock bounced back sharply to eventually close at the upper circuit for the day. This was reflective of strength in the stock amidst the improving market sentiments.

The subscription normally impacts the price discovery in book building issues and the listing price. While there was no price discovery required in this IPO, the strong subscription had a positive impact on the ability of the stock  in two ways. Firstly, it led to the stock getting listed at a premium of 15.38% at ₹30.00 per share. Secondly, and more importantly, the stock managed to bounce back from the lower circuit of the day to eventually close the day strong and at the upper circuit of the day, only due to the robust subscription levels and the overall buoyancy in the markets.

Stock closes Day-1 at upper circuit, after a rather robust start

Here is the pre-open price discovery for the Marinetrans India IPO on the NSE.

Data Source: NSE

Marinetrans India IPO was priced at ₹26 per share, being the price set in the fixed price IPO. On 08th December 2023, the stock of Marinetrans India Ltd listed on the NSE at a price of ₹30, a premium of 15.38% over the IPO issue price of ₹26. However, despite a volatile day post listing on 08th December 2023, the stock of Marinetrans India Ltd closed exactly at the upper circuit price of ₹31.50 per share.

The stock had an upper circuit limit of ₹31.50 for the day and a lower circuit limit of ₹28.50 for the day. In the midst of the volatility in trading during the day, the stock first hit the lower circuit of ₹28.50 and stayed locked in the lower circuit for some time. However, later the stock bounce back sharply and scaled the upper circuit and eventually stayed put at the upper circuit price for the better part of the day, which is where the stock closed the day.

The closing price reflects a strong day of trading, because it closed at the upper circuit after being locked in the lower circuit for a good part of the day. Also, the upper circuit comes on top of a 15.38% premium listing of the stock, which is all the more appreciable, considering that the overall premium of the stock for the day at close was 21.15% over the IPO issue price. The Nifty and the Sensex had a strong outing on Friday and had a positive impact on the stock price of Marinetrans India Ltd on the listing day.

Circuit filters for SME Emerge stocks

Being an SME IPO on the NSE, the stock of Marinetrans India Ltd was subjected to 5% circuit filter on listing day and was also in the ST (trade to trade) segment. That means, only delivery trades are permitted on the stock. Like the upper circuit price, even the lower circuit price on listing day is calculated on the listing price and not on the IPO price. The opening price of the day was also the low price of the day, meaning the stock never really dipped below the listing price and spent most part of the day at the upper circuit, locked in. During the day, the stock hit the upper circuit and closed at the upper circuit after being locked in the lower circuit for a good part of the trading day.

The high price and the low price of the stock during the day exactly corresponded with the upper circuit price and the lower circuit price for the day respectively. In fact, the stock touched the lower circuit of the day, stayed locked there for some time, before bouncing back to close at the upper circuit. On the NSE, the stock of Marinetrans India Ltd has been admitted to trade in the ST category. The ST category is specifically for the SME Emerge segment of the NSE with compulsory trade to trade settlement. On such stocks, netting of positions is not permitted and every trade has to be settled by delivery only.

How prices traversed for Marinetrans India IPO on listing day?

On Day-1 of listing i.e., on 08th December 2023, Marinetrans India Ltd touched a high of ₹31.50 per share on the NSE and a low of ₹28.50 per share. The high price of the day was exactly the upper circuit limit price of the stock while the stock low price of the day was exactly the lower circuit price of the session. Between these two extreme prices, the stock was extremely volatile and eventually closed at the upper circuit price of the day. In fact, the stock can be said to have enjoyed a strong listing and largely supported by a 68 points rally in the Nifty and a 304 points rally in the Sensex. However, it must be noted that the stock spent a good part of the trading session locked in the lower circuit, before bouncing back to close at the upper circuit of the day.

In terms of the circuit filter limits, the stock of Marinetrans India Ltd had an upper circuit filter limit of ₹31.50 and a lower circuit band limit of ₹28.50. The stock closed the day 21.15% above the IPO issue price of ₹26 per share and it also closed 5% above the listing price of the day at ₹30 per share. During the day, the stock of Marinetrans India Ltd first hit the lower circuit and stayed locked in lower circuit for a good part of the trading session. However, later the stock bounced to touch the upper circuit and stayed locked in the upper circuit for most part of the day before ending the day at upper circuit. During the day, the stock spent time at the lower circuit and at the upper circuit, traversing the full range. The stock closed strong at the upper circuit at the close of the day with 1,44,000 buy quantity and no sellers in the counter. For the SME IPOs, it may be recollected, that 5% is the upper limit and also the lower circuit on the listing price on the day of listing.

Moderate volumes for Marinetrans India IPO on listing day

Let us now turn to the volumes of the stock on the NSE. On Day-1 of listing, the Marinetrans India Ltd stock traded a total of 19.76 lakh shares on NSE SME segment amounting to trading value (turnover) of ₹580.94 lakhs on the first day. The order book during the day showed a lot of buying with the buy orders consistently exceeding the sell orders, especially in the second half of the day. That also led the stock to close with pending buy orders at the end of the trading session, although the price was also very volatile during the day. It must be noted here that Marinetrans India Ltd is in the trade to trade (T2T) segment so only delivery trades are possible on the stock. Hence the entire volume for the day purely represents the delivery volumes.

At the close of Day-1 of listing, Marinetrans India Ltd had a market capitalization of ₹40.09 crore with free-float market cap of ₹13.23 crore. It has a total of 127.26 lakh shares as the issued capital of the company. As stated earlier, since the trading is on the T2T segment, the entire volume of 19.76 lakh shares during the day is accounted by delivery trades only, barring some market trade exceptions in the market. The stock traded on the NSE under the code “MARINETRAN” and its ISIN code was “INE0P1P01017”.