Moksh Overseas IPO GMP (Grey Market Premium)

Moxsh Overseas Educon IPO worth, Rs. 10.42 crore comprises entirely of a fresh issue of the said amount. Total Moxsh Overseas Educon SME IPO entails the issue of 6.808 lakh shares at a price of Rs. 153 per share aggregating to Rs. 10.42 crore. The stock has a face value of Rs. 10 and bidders can only bid in minimum lot size of 800 share each, entailing a minimum investment of Rs. 122,400 in the IPO. That is also the maximum that a retail investor can apply for in the IPO. HNI investors can apply for a minimum of 2 lots implying a minimum bid size of 1,600 shares and entailing an investment value of Rs. 244,800. As per the terms of the offer, 50% of the net offer is reserved for the retail investors and the balance 50% for the HNI (NII) investors. It is a fixed price issue and Pure Broking Private Limited will act as the market maker for the SME IPO of Moxsh Overseas Educon Ltd.

The issue opens for subscription on 21st December 2022 and closes for subscription on 23rd December 2022 (both days inclusive). The basis of allotment will be finalized on 28th December 2022 and the refunds will be initiated on 29th December 2022. In addition, the demat credits are expected to happen on 30th December 2022 and the stock is scheduled to list on 02nd January 2023 on the NSE SME segment. This is the segment, in contrast to the mainboard, where IPOs of small and medium enterprises (SMEs) are incubated. The grey market price (GMP) trading normally starts about 4-5 days prior to IPO opening and continues till the listing date. In the case of Moxsh Overseas Educon Ltd, we already have GMP data for the last 3 days, which should give a reasonable picture of the likely listing.

There are 2 factors that impact the GMP. Firstly, the market conditions have a deep impact on the GMP, especially the liquidity conditions in the market. Secondly, the extent of subscription for the IPO has a deep impact on the GMP as it is indicative of investor interest in the stock. GMP can also technically be in negative, which means the stock would list at a discount to the issue price.

There is one small point to remember here. The GMP is not an official price point, just a popular informal price point. However, in most cases, it has been observed to be a good informal gauge 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 of the stock would be.

GMP tends to be a good mirror of the real stock story. More than the actual price, it is the GMP trend over time that gives insights about which direction the wind is blowing. Here is a quick GMP summary for Moxsh Overseas Educon IPO data is available.

In the above case, the GMP trend shows that the grey market premium has opened at around Rs. 52, and has since been stable in the range between Rs. 50 and Rs.  52. Of course, we have to await for the actual subscription numbers to flow in when the issue opens for subscription and also watch the progress, as that would have a very significant impact on the GMP. In the past, stocks which got oversubscribed in the IPO also saw a very robust positive shift in the grey market pricing. For a start, Moxsh Overseas Educon Ltd has shown very strong traction in the grey market.

If you consider the price of the Moxsh Overseas Educon IPO at Rs. 153, then the likely listing price is being signalled at around Rs. 205 per share as per the GMP indicator on 21st December 2022. This is dynamic and keeps changing. 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. 52 on a fixed IPO price of Rs. 153 indicates a listing premium of 33.99% for Moxsh Overseas Educon Ltd on the listing price. That pre-supposes a listing price of approximately Rs. 205 per share, when Moxsh Overseas Educon Ltd lists on 02nd January 2023. Of course, these are approximations, so you must keep a margin of safety. However, that would depend on the GMP sustaining over the next few days after the issue opens. The best thing one can do with the GMP is to observe the trend closely as that gives the best hints on listing status. Focus on the time series trend than on numbers.

Moxsh Overseas Educon Limited is a 4 year old company engaged in offering learning solutions, counselling and mobility services to medical studies (MBBS) students in India and abroad. Student mobility offers university guidance, Application Support and University Placement. The Healthcare Academy focuses on entrance exams like NEET-UG and other medical licensing exams. Moxsh has a presence across 23 touch points across 18 Indian cities, apart from 5 major branches.

The fresh funds will be used for working capital needs and for improving the visibility of its brand. Post the IPO, the promoter share in equity will dilute from 88.49% to 61.61%. The issue is being lead managed by Fedex Securities Limited. Bigshare Services Private Limited will be the registrars to the issue.