Synoptics Technologies IPO GMP (Grey Market Premium)

Synoptics Technologies IPO worth ₹54.03 crore comprises of a fresh issue and an offer for sale (OFS) by promoters and early shareholders. It is a fixed price issue and the price has been fixed at ₹237 per share. The company will issue a fresh issue portion of 14.80 lakh shares at the price of ₹237 per share aggregating to a total fund raising of ₹35.08 crore. The offer for sale (OFS) by the company will entail the sale of 8.00 lakh shares at the price of ₹237 per share aggregating to an OFS size of ₹18.96 crore. The overall size of the IPO, therefore, would entail the issue of 22.80 lakh shares, which at the fixed price of ₹237 per share aggregates to a total issue size of ₹54.03 crore

The stock of Synoptics Technologies IPO has a face value of ₹10 and bidders can only bid in minimum lot size of 600 share each, entailing a minimum investment of ₹142,200 in the IPO at the fixed price level of ₹237 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 1,200 shares entailing an investment of ₹284,400. The table below captures the lot sizes permissible.

As per the terms of the offer, 50% of the net offer is reserved for the retail investors and the balance 50% for non-retail investors belonging to the HNI / NII category. It is a Book Built issue with the price band and the final price will be discovered through book building process. NNM Securities Ltd will act as the market maker for the SME IPO of Synoptics Technologies Ltd. The company has set aside 114,000 shares for the market maker.

The issue opens for subscription on 30th June 2023 and closes for subscription on 05th July 2023 (both days inclusive). The basis of allotment will be finalized on 10th July 2023 and the refunds will be initiated on 11th July 2023. In addition, the demat credits are expected to happen on 12th July and the stock is scheduled to list on 136th July 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 Synoptics Technologies Ltd, we already have GMP data for the last 2 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 Synoptics Technologies IPO for which the data is available.