Punjab and Sind Bank IPO Lists with 20 % Premium

December 30, 2010   ·   0 Comments

www.stockssavvy.comShares of state-owned Punjab & Sind Bank opened at Rs 144 on National Stock Exchange, with a premium of 20% over issue price of Rs 120 a share, which was below experts’ expectations. Experts were expecting 25% premium on listing.

The stock touched a high of Rs 146.70 and low of Rs 127.10 in early trade. At 10:30 hours IST, a share was trading at Rs 130.15, up 8.46%, with volume of 1.8 crore equity shares.

Retail investors and employees received shares at Rs 114 – a 5% discount to issue price. So at opening price, the premium for them was 26.32%. It means profit of Rs 30 per share. For 50 shares, the profit is Rs 1500 on investment of Rs 5700.

In a press conference, the company said, “We could think of FPO, Tier II capital or rights issue in long term for raising money. Recently bank raised BPLR by 50 bps.”

On Bombay Stock Exchange, a share was trading at Rs 130, after hitting a high of Rs 149.70 and low of Rs 127.60 in early trade. Traded volume was more than 97 lakh equity shares.

The bank raised Rs 470.82 crore through IPO, which was subscribed 50.75 times. The 4 crore equity shares’ IPO was opened for subscription during December 13-16.

Verdict: Hold the Stock for Mid to Long Term View. Company is doing much better to Justify levels way above 130 Rs.


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