Readymade Steel plunges 38.5% on debut

It was a bad day for Readymade Steel India. The stock saw huge selling pressure despite positive trend in the market.

The stock gained as much as 9% to hit an intraday high in early trade of Rs 117.75, before seeing a sharp sell-off. It plunged 38.5%, to close at Rs 66.45 a share on the Bombay Stock Exchange. Total traded volume was nearly Rs 3.4 crore shares - i.e. 10 times more than the issue size of about 32 lakh equity shares. Readymade Steel is primarily engaged in the business of providing ready to use steel for construction activities to the infrastructure industry. In an interview with CNBC-Awaaz, company's MD Anil Agrawal expects 50% growth in sales for FY12. "Our current capacity stands at 27,000 tonne, which will be increased to 1.9 lakh tonne after expansion," he said. Company intends to deploy issue proceeds of Rs 34.75 crore for partly financing the expansion of existing facility at Khopoli, Maharashtra and setting up of new facilities near New Delhi and Raipur; and working capital requirements.