Mumbai: Shares of leading coffee chain operator Coffee Day Enterprises made a weak debut on the bourses Monday, plunging nearly 18 percent, over the issue price of Rs 328.
The stock of Coffee Day Enterprises, which runs Cafe Coffee Day (CCD) chain, listed at Rs 313, a discount of 4.57 percent over the issue price on BSE.
Massive selling soon engulfed the stock and it finally ended at Rs 270.15, reflecting a sharp decline of 17.63 percent. During the day, the stock plunged 18.9 percent to hit a low of Rs 266.
At NSE, shares of the company nosedived 17.54 percent to settle at Rs 270.45.
"The opening of the stock was bearish considering the price it was offered at Rs 328 per share. The correction in the stock is a near term adjustment to its valuations," said Achin Goel, Head: Wealth Management & Financial Planning, Bonanza Portfolio Ltd.
Volumewise, 37.99 lakh shares of the company changed hands at BSE and over one crore shares were traded at NSE during the day.
The company commands a market valuation of Rs 5,565.14 crore.
Coffee Day Enterprises' Rs 1,150-crore public issue was subscribed 1.81 times last month.
The company, which competes with global giant Starbucks in the fast-growing Indian consumer market, had fixed a price band of Rs 316-328 per share for its IPO.
Coffee Day Enterprises had raised over Rs 334 crore from anchor investors ahead of its IPO while in March the firm had mobilised Rs 100 crore in a pre-IPO funding from Nandan Nilekani and Rare Enterprises (owned by Rakesh Jhunjhunwala and Ramesh Damani), among others.
Promoter holding in the company stands at 52.56 percent while FIIs and domestic institutional investors (DIIs) hold 6.49 percent and 10.68 percent, respectively, as per BSE data.
Coffee Day Enterprises is the parent company of Coffee Day Group and operates coffee business through a subsidiary, Coffee Day Global Ltd (earlier known as Amalgamated Bean Coffee Trading Company Limited) and its subsidiaries.
Meanwhile, shares of IT firm MindTree where Coffee Day Enterprises holds 10.41 percent stake, fell 4.31 percent to Rs 1,500.70 on BSE.
In the broader market, the BSE benchmark Sensex ended with a loss of 97.68 points at 26,559.15.