Wonderla lists at premium

The much anticipated listing on Wonderla Holiday happened today. As against an issue price of Rs.125/share, the stock got listed at Rs.160 on the NSE and Rs.164.75 on the BSE. Then it started going down, like fizz disappearing from a cola bottle. On the BSE, it hit the lower circuit at Rs.156.50.

The IPO was subscribed over 38 times on the final day of bidding, with the non-institutional book getting subscribed 159.04 times. It was HNIs who participated in huge numbers. This amusement park IPO had evinced immense investor fancy, which explains its huge subscription. But looks like most of it was for listing gains only and our Editor Mr.SP Tulsian, advices sell at this juncture.

At the time of the IPO, there was a bevy of activity in the grey markets and many HNIs had borrowed heavily, lured by the high premium in grey markets to subscribe to the IPO. Some Rs.4000 crore worth of leveraged bets were placed by HNIs and this has been borrowed at an interest rate of 7-10% for up to 10 days. Thus we could see a flurry of selling by these HNIs who have invested mainly to make a quick buck on listing.