Pharma sector company Bio Medica Laboratories entered the stock market on May 29, but this launch was no less than a big shock for investors. The company’s shares had a very disappointing entry on the National Stock Exchange (NSE SME). Common investors who had invested their money in the IPO at Rs 139 per share in the hope of profit, had to suffer huge losses with the listing. The share opened at Rs 111.20 with a huge discount of 20 percent.
This decline in the market did not stop here. Immediately after the listing, another big fall of 5 percent was recorded in this share, due to which the share price reached Rs 105.65. Due to this continuous selling, the stock entered lower circuit. This simply means that there were many sellers of this share in the market, but no buyers were present.
Investors’ hopes dashed in the stock market
When the IPO of any company comes in the market, common investors invest money in the hope that they will get a good and safe return on the day of listing. In the case of Bio Medica Laboratories, the situation was completely opposite. The IPO price of this pharma company was fixed at Rs 139, which was kept to attract investors. But when stock market trading started today, the confidence of investors was broken. When the price fell to Rs 105.65 after opening at Rs 111.20, investors started seeing a huge loss in their portfolio. Due to lower circuit, the deals of those who wanted to sell their shares in panic could not be completed.
How was the market’s response to the IPO?
To deeply understand this huge decline, we have to go back a little. The company had taken out its public issue to raise capital of Rs 52.43 crore from the market. This issue was open for investment on May 21, in which the opportunity to invest money was given till May 25. If we look at the subscription figures, it was subscribed 2.26 times overall by the investors.
Trends of different categories of investors
Most enthusiasm about this IPO was seen among big investors i.e. Qualified Institutional Buyers (QIB). The portion reserved for them was filled 15.94 times. At the same time, the share of general investors (retail investors) was also subscribed about 2.92 times. Apart from this, the portion reserved for non-institutional investors was filled 1.30 times. Looking at these figures, it seemed that this stock could get a good start in the market, but the reality of the listing day proved all these estimates wrong.
What does Bio Medica Laboratories do?
Bio Medica Laboratories mainly specializes in the field of manufacturing pharmaceutical parenteral formulations. If you understand in simple language, the company works to prepare injections ranging from liquid form to dry powder. The company’s portfolio is quite extensive. It manufactures ethical medicines as well as generic medicines. Apart from this, the company also produces over-the-counter (OTC) medicines, which patients can buy directly from medical stores.
The products of this company are not limited to humans only. Bio Medica Laboratories caters to the health needs of humans as well as animals. Its injections are available in the market in different formats ranging from single-dose to multi-dose.
Disclaimer: This article is for information only and should not be considered as investment advice in any way. TV9 Bharatvarsha advises its readers and viewers to consult their financial advisors before taking any money-related decisions.
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