New Delhi: ICICI Securities shares made a dismal debut on stock exchanges on Wednesday wiping out nearly Rs 3,000 crore of investors’ wealth in a single day. ICICI Securities shares fell over 17 per cent to an intraday low of Rs 431.20 on BSE as compared to its issue price of Rs 520. With this listing market capitalisation (total market value of all issued shares) of ICICI Securities fell to a low of Rs 13,884.48 crore compared to its market value of Rs 16,747.70 crore at the issue price of Rs 520.
The initial public offer (IPO) of the ICICI Bank promoted broking firm, which closed on March 26, failed to attract HNI investors and was subscribed 88 per cent following which the issue size was trimmed to little over Rs 3,500 crore, as compared to its original size of Rs 4,016 crore. The segment reserved for HNI customers was subscribed only 36 per cent. The institutional and retail segment was subscribed 1.04 times and 0.34 times respectively.
Price band of ICICI Securities IPO was set at Rs 519-520. At the higher end of the price band, ICICI Securities shares are valued at nearly 32 times its FY18 estimated earnings per share of Rs 16.48, which was much higher than its peers, said analysts.
However, Hemang Jani, Sr. Vice President, Head Equity Sales & Advisory at Sharekhan, made a case for buying ICICI Securities shares after today’s 17 per cent fall. He said that the stock is a good buy for a 1-2 year view.
As of December 31, 2017, ICICIdirect.com had approximately 3.9 million operational accounts of whom 8 lakh had traded on NSE in the preceding 12 months. Since inception, the company had acquired a total of 4.6 million customers.
With increasing household savings getting shifted from physical assets to financial assets in India, ICICI Securities stands to benefit from this transformation given its strong brand name, large customer base and a wide range of products across asset classes, say analysts.
As of 10:40 am, ICICI Securities shares made some recovery and were trading 11.56 per cent lower at Rs 459.90 apiece.