First Winner Industries loses on debut

First Winner Industries was trading at Rs 82.85 at 10:43 IST on BSE, a discount of 33.72% over the initial public offer price of Rs 125.

The stock debuted at Rs 125 which was also its high so far during the day. However the stock was unable to sustain at higher levels and tumbled to hit an intra-day low of Rs 80.50

The counter saw volumes of 28.62 lakh shares on BSE

Meanwhile, the BSE Sensex was down 388.85 points or 2.87% to 13,137.44 after fragile credit markets rattled Asian and US stocks. On Monday, 7 July 2008, a Lehman Brothers report said a pending accounting change could force Fannie Mae and Freddie Mac, the top US mortgage funders, to raise a combined $75 billion in capital at a tough time.

First Winner Industries had priced the initial public offer (IPO) at the top end of the Rs 115 to Rs 125 price band. The issue was subscribed 1.26 times. The IPO opened on 9 June 2008 and closed on 17 June 2008.

First Winner is engaged in the manufacture of grey fabrics and in supplying textile fabrics to various wholesalers, apparel and garment manufacturers. The company plans to utilise the IPO funds to set up a new apparel manufacturing facility at an estimated cost of Rs 12.04 crore with production capacity of 5,000 pieces per day of men's shirts. It also plans a new weaving unit at an estimated cost of Rs 21.64 crore to increase its existing production capacity to 170 lakh meter per annum. The company also intends to prepay term loan amounting to Rs 18 crore.

The company reported 4150% spurt in net profit to Rs 2.55 crore on 45.20% rise in net sales to Rs 55.50 crore in the year ended March 2007 over the year ended March 2006