Spectrum Talent Management IPO GMP (Grey Market Premium)

Spectrum Talent Management IPO GMP
Spectrum Talent Management IPO GMP

by Tanushree Jaiswal Last Updated: Jun 26, 2023 - 11:18 am 6.8k Views

Spectrum Talent Management IPO worth ₹105.14 crore, comprises entirely of a combination of a fresh issue of shares and an offer for sale (OFS) by promoters and early shareholders. Spectrum Talent Management IPO is a book built SME IPO with an indicative price range of ₹169 to ₹173 per share. The stock has a par value of Rs10 per share and the total stands outstanding post the issue would be 51.86 lakh shares.

The fresh issue component entails the issue of 51,85,600 shares, which at the upper end of the price band at ₹173 per share would be worth ₹89.71 crore. The OFS portion entails the issue of 8,92,000 shares, which at the upper end of the price band at ₹173 per share is worth ₹15.43 crore. Therefore, the overall size of the Spectrum Talent Management Ltd IPO will entail the issue of 60,77,600 shares, which at the upper end of the price band at ₹173 per share translates makes the total IPO issue size worth ₹105.14 crore.

Spectrum Talent Management IPO, the bidders can only bid in minimum lot size of 800 share each, entailing a minimum investment of ₹138,400 in the IPO at upper IPO price band of ₹173 per share. That is also the maximum that a retail investor can bid in the IPO. HNIs, NIIs can bid for minimum of 2 lots of 1,600 shares entailing an investment of ₹276,800. The table below captures the lot sizes permissible.

Application Lots Shares Amount
Retail (Min) 1 800 ₹138,400
Retail (Max) 1 800 ₹138,400
HNI (Min) 2 1600 ₹276,800

As per the terms of the offer, there is a reservation for all the 3 categories of investors viz. QIBs, retail and the HNI / NII portion. This is a book built issue where the price band has bene set in the range of ₹169 to ₹173 per share and the actual IPO price for the issue would be discovered in this band through the process of book building. The table below captures the break-up of the issue size by target investors.

QIB Shares Offered Not more than 50% of the Net Issue
NII (HNI) Shares Offered Not less than 15% of the Net Issue
Retail Shares Offered Not less than 35% of the Net Issue

Rikhav Securities Ltd will act as the market maker for the SME IPO of Spectrum Talent Management Ltd. The company has set aside 304,000 shares for the market maker. This portion will be carved out of the non-retail portion and is included in that quota.

Key dates to remember in the Spectrum Talent Management Ltd IPO

The issue of Spectrum Talent Management Ltd opened for subscription on 09th June 2023 and closes for subscription on 14th June 2023 (both days inclusive). The basis of allotment will be finalized on 19th June 2023 and the refunds will be initiated on 20th June 2023. In addition, the demat credits are expected to happen on 21st June 2023 and the stock is scheduled to list on 22nd June 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 Spectrum Talent Management Ltd, we already have GMP data for the last 2 days, which should give a reasonable picture of the likely listing.

Down to brass tacks on GMP pricing

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 Spectrum Talent Management IPO for which data is available.

Date GMP
22-June-2023 ₹-12
21-June-2023 ₹-10
20-June-2023 ₹2
19-June-2023 ₹13
18-June-2023 ₹5
17-June-2023 ₹13
16-June-2023 ₹9
15-June-2023 ₹15
14-June-2023 ₹18
13-June-2023 ₹18
12-June-2023 ₹18
11-June-2023 ₹22
10-June-2023 ₹22
9-June-2023 ₹38
8-June-2023 ₹38
7-June-2023 ₹33
6-June-2023 ₹32

In the above case, the GMP trend shows that the grey market premium has opened at around ₹32, but now dropped by ₹-12. 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, Spectrum Talent Management Ltd has shown good traction in the grey market.

If you consider the upper price band of ₹173 for the IPO of Spectrum Talent Management Ltd as benchmark, then the likely listing price is being signalled at around ₹205 per share as per the GMP indicator on 07th June 2023. 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.

The GMP of ₹32 on the fixed IPO price of ₹173 indicates a listing premium of a healthy 18.5% for Spectrum Talent Management Ltd over the listing price. That pre-supposes a listing price of approximately ₹205 per share, when Spectrum Talent Management Ltd lists on 22nd June 2023. Of course, these are approximations, so you must keep a margin of safety. One needs to observe the trend of GMP closely as that gives the best hints on listing status. Look at the time series trend than on numbers.

Read What you must know about Spectrum Talent Management IPO

Here is a quick word on the business model of Spectrum Talent Management Ltd; an SME IPO on NSE opening for subscription on 09th June 2023. Spectrum Talent Management Ltd, was incorporated in 2012 to provide high quality human resource and staffing services to corporate and other institutional clients; both offshore and onshore. It has over 275 corporate and institutional clients and employs more than 15,600 personnel at client sites.

The promoters; Vidur Gupta and Sidharth Agarwal, are veterans of the space and have over 28 years in the staffing vertical. Spectrum Talent Management Ltd offers payroll, recruitment, onboarding, and also facilitates flexible staffing. The business model of Spectrum Talent Management IPO is aimed at satisfying the staffing, and recruitment needs of clients with their specialized knowledge, domain skills and their networks spread.

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About the Author

Tanushree is a seasoned professional with 6 years of experience in the Fintech and Edtech industry.


Investment/Trading in securities Market is subject to market risk, past performance is not a guarantee of future performance. The risk of loss in trading and investment in Securities markets including Equites and Derivatives can be substantial.
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