eMudhra IPO GMP
The eMudhra consists entirely of an offer for the sale of ₹251.79 Crore by the promoters and PE investors. The issue has been priced in the band of Rs.243 to Rs.256 per share and the IPO allotment price will be discovered post the book building process completion.
The issue will open for subscription on 20th May and will close for subscription on 24th May. Check IPO Allotment Status of eMudhra on 27th May. The stock is scheduled to list on 1st June. The GMP trading normally starts about 4-5 days prior to IPO opening and continues till the listing date.
In the below case, the grey market premium has remained at Rs.10. Of course, we’ll have to wait for the actual subscription numbers to flow in.
eMudhra IPO GMP
If you consider the upper end of the price band of Rs.256 as the indicative price, then the likely listing price is being signaled at around Rs.266 per share (Upper band price+ GMP). One data point to track will be the subscription update on the stock as that would chart the GMP course from here.
The GMP of Rs.10 on a likely upper band pricing of Rs.256 indicates a listing premium of a very robust 3.90% over the listing price. That presupposes a listing price of approximately Rs.266 per share, when eMudhra actually lists on 1st June 2022.
Market conditions and extent of subscription have a deep impact on the GMP as it is indicative of investor interest in the stock.
One important thing to remember is that GMP is not an official price point, it is just an informal price point. However, in most cases, it has proved to be a good informal indicator of demand and supply for the IPO. Hence it does give a broad idea of how the listing is likely to be and how the post-listing performance would be.
GMP is an essential informal indicator of likely listing price, although it tends to be quite dynamic and changes direction with the flow of news. Here, investors must note that this is just an informal indication and has no official sanction. However, for traders who are in the stock for the short term, the GMP gives a reasonably good indication of the likely listing price and the likely listing returns on the IPO.
The catch is that this can grey market price can still keep changing depending on how the subscription pans out once the actual issue opens. That is why the trend of the GMP is as critical as the quantum of GMP.
DisclaimerInvestment/Trading is subject to market risk, past performance doesn’t guarantee future performance. The risk of trading/investment loss in securities markets can be substantial. Also, the above report is compiled from data available on public platforms.
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