Profit booking drags Ujjivan Financial Services down by more than 10%

Ujjivan Financial Services cracked on Monday and is trading down by almost 11.50 percent at the time of filing this report. The stock is trading at Rs. 338 down by almost Rs. 44.50 on an intra day basis. 

The share has cracked even as it completes one month of its listing which also is the lock-in period for the anchor investors. Several anchor investors including Birla Sunlife Trustee Company, ICICI Prudential, UTI Mutual Fund, Reliance Capital , Sundaram Mutual Fund, Tata Mutual Fund, HDFC Standard Life Insurance, Bajaj Allianz Life Insurance, Reliance Life Insurance have invested in the IPO of Ujjivan Financial Services. Ujjivan had raised Rs. 264.74 crores from the anchor investors during the initial public offering.

The stock had reached Rs. 400 levels on June 3, thus gaining almost 90 per cent from its issue price of Rs. 210. Experts believe profit booking is warranted in the stock as it rallied fast to make valuations look uncomfortable and unsustainable. Post the mandatory lock-in period of 30 days the anchor investors are now allowed to book profits in the counter that has given above normal returns in such a short period.

Ujjivan Financial Services Ltd., an Indian micro-finance services company was incorporated in the year 2005. The company offers individual loans to Micro & Small Enterprises (MSEs) and group loans as per customer requirement including agriculture, education,home improvement, home purchase and livestock loans.