Shares of Motisons Jewelers made a stellar stock market debut earlier today, opening at nearly double their issue price on both the NSE and BSE. However, the stock soon hit the lower circuit, plunging 10% from the day’s high.
The initial public offering of Motisons Jewelers, which closed on December 20, had seen robust investor interest. The IPO was subscribed 159.61 times, with strong participation from institutional and retail investors.
The company’s shares got listed at Rs 109 on the NSE, a 98% premium over the issue price of Rs 55 per share. On the BSE, the stock opened at Rs 103.9, up 89% from the issue price.
The opening prices meant investors who got allotment in the IPO doubled their money right on the listing day. However, the stock soon hit a lower circuit of 10% on both exchanges, sliding to Rs 98 on the NSE and Rs 93 on the BSE.
Analysts attribute the sudden crash in the stock price to profit-booking by investors after the stellar listing gains. The IPO saw high demand due to attractive pricing and positive market sentiment. But questions remain over Motisons’ valuations.
“The stock ran up too far, too fast in morning trade. Lower circuit was triggered as investors rushed to book profits,” said Rakesh Nayak, analyst with a leading brokerage.
Founded in 1997, Motisons Jewelers sells gold, diamond and gemstone jewelry through its flagship store in Jaipur. The company offered 2.74 crore fresh shares in the IPO to raise Rs 151 crore.
While the listing pop and sudden decline took the market by surprise, investors will now keenly watch how Motisons shares trend in the coming weeks. The stock remains volatile and will likely see high intra-day movements initially.