Shock drops in the last two IPO shares, GRTRK and CWENE, triggered a new fear: Is the end of the IPO rises, the only branch that stock market investors hold on?
Since the beginning of this year, it is not possible to talk about the smile on the face of the stock market investors in general. In the first months of the year, there was a rising risk with a sharp fluctuation margin of close to 10 percent, which was formed by up and down oscillations within the same session. After the earthquake disaster, it was only possible to stop the market, which came to the point of collapse without volume, only with the measures taken. Then, we encountered the stock market, which was constantly in a downtrend, creating losses despite the continued rise in the dollar and inflation. In this process, the number of investors rose to record levels, unprecedented in the history of the stock market. Of course, the only reason for this was the millions of investors who came with new public offerings.
Is it the end of the stock period that makes 6-7x?
Investors who could not protect their money in alternative markets with returns exceeding 100 percent of their shares offered to the public since 2022, and even 6-7 times in some, were attracted by these incredible returns in public offering shares, and hundreds of thousands of new investors were entering the stock market by applying to public offerings every month. In other words, this structure, which resembles a pyramid scheme, added hundreds of thousands of new rings to its chain with new investors at each new public offering, and demand records were renewed at each public offering.
GRTRK share price lost 29 percent from peak
However, what happened after the two public offerings that took place in the past days suddenly caused question marks in the minds of investors. First, Graintürk Tarım, namely GRTRK, started to decline in the 7th session, after being offered to the public, and after hitting 6 consecutive ceilings. GRTRK’s share price, which started with a public offering price of 17.6 TL, rose to 32.20 TL, first reaching a return of 83 percent. However, in the decline it started from here, it lost value for three consecutive sessions and went down to 22.70 TL, reducing this return to 29 percent. In fact, the loss of those who bought this share at the peak price is currently 29 percent.
CWENE share price lost 18 percent in a single session
Then there was a sharper return in CWENE share price, that is, in CW Enerji shares. The shares, offered to the public at a price of 108.60 TL, went up to 144.40 TL with three ceilings and collapsed to the bottom on the day when the third ceiling was reached. According to Friday’s closing, the share price is 118.20 TL. So again, 18 percent in a session lost for those who buy from the top.
Now, the question mark in mind is this: Does the belief that “whatever you buy from the public offering, you win” is collapsing? Will the performance of these two stocks affect both demand and performance in future public offerings? Will the investors start to fear “What if something similar happens” for the public offerings they will participate in next?
Is it similar to 2022?
Stock market investors experienced a similar process in 2022. However, this process was short-lived due to the fact that the stock market had no alternative and the investor who wanted to protect his money did not have any other investment tool to go to. Now, we are talking about an election before us and the potential for very high returns in alternative markets after the election. What will happen to the dollar rate, gold and silver rallies supported by the commodity side, new levels that have been reached and can be reached in the future, and the expectations of recovery on the crypto money side, there are now many alternatives for the money earned in the stock market. This raises some questions about whether the recovery in IPOs may be rapid.
For the rest of the article Is the ceiling madness over in public offerings?