How have the IPOs of LIC and Delhivery performed since the listing?

When the IPOs of LIC and Delhivery hit the IPO markets, they were significant with the promise of being bellwethers. To begin with, there were a number of similarities between the two companies. Both were coming after the Russia crisis. Both the IPOs had shown tepid subscription performance during the IPOs. Also, both the IPOs had substantially reduced their issue size on apprehensions that the appetite for a very large issue may not be there.

The differences are also quite stark. Delhivery issue saw strong FPI interest during the IPO while LIC had limited FPI interest and more of mutual fund appetite for the stock. But the reason both have diverged from each other is the post listing performance of both the stock. While Delhivery has shown solid growth reflected in the price of stock, LIC has been a disappointment.

Let us look at the LIC performance first. The stock listed below the issue price of Rs949 per share and kept sliding lower. Since the time of listing, the high price for LIC was Rs918.95 while the low price is Rs751.80. As of 08th June, the stock of LIC is trading close to its lows at Rs752.90. That translates into an effective discount of -20.7% to the IPO price of Rs949. The loss to the retail and the policyholders was more muted in comparison.

Let me now turn to Delhivery. The price of the Delhivery IPO was discovered at the upper end of the price band at Rs487. Delhivery had a tepid listing but picked up sharply after that. In the period since listing, Delhivery Ltd has touched a high price of Rs617.35 and a low price of Rs467.50. The stock has remained above the issue price for a better part of the post listing period. This gives a lot of comfort to the investor.

What could be the reason for this dichotomy in the post-issue performance of these stocks? One reason could be the Q4FY22 quarterly results for the quarter ended on March 2022. LIC saw is profits fall by 15% yoy for the quarter amidst rising costs and higher provisions. If you look at the quarterly number of Delhivery, it is indicating although the income flows may stop, the business flows were still strong. On the other hand, Delhivery maintained losses at the same level as last year. It is this dichotomy in aggression that is leading the prices of the two stocks to sharply diverge from the current levels