Mumbai: Shares of New India Assurance Company Ltd (NIACL) and IFCI came under heavy selling pressure on Tuesday, September 8, falling as much as 14% as the NSE IPO grey market premium (GMP) witnessed a sharp correction.
NIACL shares plunged 13.71% to an intraday low of Rs 199.52, compared with the previous close of Rs 231.20. At around noon, the stock was trading 9.50% lower at Rs 209.50 on the NSE.
The decline came after NIACL shares had rallied nearly 30% over the past few weeks on growing expectations around the proposed National Stock Exchange IPO.
Why Are NIACL Shares in Focus?
NIACL holds a 1.42% stake in NSE, making the stock sensitive to developments surrounding the exchange's much-awaited public issue.
Meanwhile, IFCI shares fell nearly 10% to touch an intraday low of Rs 92.75, against the previous close of Rs 102.51. Around noon, IFCI was trading 8.11% lower at Rs 94.16.
IFCI owns a 52% stake in Stock Holding Corporation of India Ltd (SHCIL), which holds around 4.4% in NSE.
IFCI shares had surged as much as 40% in recent weeks amid the NSE IPO buzz.
NSE IPO GMP Drops Sharply
The latest sell-off coincided with a steep decline in the NSE IPO GMP, which fell to Rs 221 on September 8 from Rs 310 on September 5.
Earlier this month, the Securities and Exchange Board of India issued an observation letter for NSE's proposed Rs 30,000 crore IPO, marking an important step towards the long-awaited listing.
Separately, BSE Managing Director and CEO Sundararaman Ramamurthy said NSE had confirmed that it would not seek permission to trade its own shares on its exchange after listing, according to reports.
The clarification followed speculation over whether NSE shares could trade on its own platform under the permitted-to-trade category.
