Get insights into the high volatility witnessed on the first day of the Vedant Fashions OFS (Offer for Sale). Learn about the Ravi Modi Family Trust's plan to offload a stake, the discounted floor price, and the impact on share prices during the market session.


Promoters of Vedant Fashions, the parent company of Manyavar, recently announced an OFS wherein they would be offloading 9.88% of the company as today marked the beginning of said OFS, leading to a volatile market session for the stock.

Ravi Modi Family Trust has announced its plan to sell a 7% stake in the company via an OFS with an option to sell an additional 2.88% in case of oversubscription. The floor price of the OFS had been set at Rs 1,161 per share, which was at a 7% discount when compared to yesterday’s closing price.

18th May 2023 i.e. today was the ‘T’ Day which marked the first day of an OFS which is reserved for non-retail investors. Tomorrow is the second day i.e. the ‘T+1’ day which will enable retail investors to take part in the OFS. Any part of the non-retail portion of the OFS will be available for subscription by retail investors.

Such OFS was launched by the promoter group to comply with SEBI’s shareholding norms. According to said rules, promoters of listed entities cannot hold more than 75% of the listed company to ensure the public investors are not taken advantage of. As of March 2023, the Ravi Modi Family Trust and other promoters held 84% of the company combined.

As a result of the heavily discounted floor price, the share witnessed a massive gap-down opening as it opened 4% lower than yesterday’s closing at Rs 1,198 per share. However, buying continued in the stock as its price steadily climbed up throughout the session today.

However, a sharp bull movement was visible after 12:30 as bulls took over the stock, driving it to the day’s high of Rs 1,319.80 per share. However, after 2:00, the bears actively began selling as the price fell over 2% in less than 5 mins.

For the remaining 90 mins, the stock steadily declined until it finally closed at Rs 1,249.10 per share, closing marginally higher than yesterday’s close but witnessing high volatility during the day with a volume of 1.3 million against its daily average of less than 200K.

- Aman Agarwal

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