The poor sentiments in the broader markets and the flop show by India’s largest IPO, Paytm, has jittered the sentiments in the primary market, shows the grey market premia.
The premium for Go Fashions has declined to Rs 490, which is about 70 per cent over its issue price of Rs 690. The company was commanding a premium of Rs 560, about 82 per cent over the given price, in the grey market earlier.
Dealers said investors have turned cautious over valuation concerns after the recent meltdown in the market and have been avoiding pricey stake sales.
Abhay Doshi, co-founder, UnlistedArena, said the sentiments for Go Fashions have been affected, though the impact has not been a severe one. The company would have a strong listing pop on Tuesday, he added.
The Rs 1,013.61-crore IPO of Go Fashions was open for subscription between November 17 and November 22 in the price range of Rs 655-690. The issue was subscribed 135.46 times, thanks to strong buying from institutions and HNIs.
Meanwhile, the premium for Rakesh Jhunjhunwala-backed Star Health and Allied Insurance Company has fallen sharply in the grey market. The company has been trading at par on Monday as the euphoria fizzled out.
The premium was Rs 150 per share when the issue was announced, which is now only Rs 10, said the dealers. Investors have turned wary following the new variant of Covid-19, they said. “The company is richly valued compared to its peers and has turned into a loss making venture after the Covid-19 claims,” added Doshi, an avid tracker of the grey market. “The new variant has also added to its woes.”
Star Health and Allied Insurance is eyeing to raise Rs 7,249.18 crore via its initial stake sale between November 30 and December 2. The company will sell its shares in the range of Rs 870-900 apiece.
Tega Industries, another company looking to mop up funds via an IPO this week, is trading at a premium of Rs 310, compared with its price band of Rs 443-453. The company will raise Rs 619.23 crore between December 1 and 3.
