Sigachi Industries IPO: What GMP signals after announcement of share allotment 


Sigachi Industries IPO: After announcement of share allotment yesterday, lucky bidders of the public issue are anxiously waiting for the listing date i.e. 15th November 2021. The public issue worth 125.43 crore received rave response from the bidders as it got subscribed 101.91 times. So, market observers and lucky bidders are expecting bumper listing gain from the initial public offering. In fact, grey market is also reflecting about strong listing of the public issue as shares of Sigachi Industries are available at a premium of 200 in the grey market today.

Sigachi Industries IPO GMP

According to market observers, Sigachi Industries grey market premium (GMP) today is 200, which is 20 higher from its yesterday’s GMP of 180. Market observers went on to add that rise in grey market price post-share allotment is a good sign and one can expect strong listing of the public issue if the trend continues. They said that generally GMP of a public issue goes down after the share allotment but in the case of Sigachi Industries IPO, grey market has remained bullish. Sigachi Industries IPO GMP today is 200, which is much higher than the price band of the public issue.

What this GMP mean?

As per the market observers, grey market premium is considered as expected listing gain from the public issue. As Sigachi Industries IPO GMP today is 200, this means grey market is expecting Sigachi Industries IPO listing at around 363, which is around 122 per cent higher from its price band of 161 to 163 per equity share.

However, if we go by stock market experts’ views, grey market premium is an unofficial data and hence one should not rely much on it. They advised bidders to look at the financials of the company as it gives clear picture of the company’s business.

Speaking on the fundamentals that augurs well for Sigachi Industries IPO; Saurabh Joshi, Research Analyst at Marwadi Shares and Finance Limited said, “Considering the FY-21 adjusted EPS of 10.80 on the post-issue basis, the company is going to list at a P/E of 15.10 with a market cap of 5,011 mn. There are no listed companies in India whose business is comparable with that of the company’s business.” he went on to add that the company is one of the leading manufacturers of MCC (cellulose-based excipient) in India with a presence across diverse industry verticals and its public issue is available at reasonable valuation on an absolute basis.

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint.

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