Tarsons Products IPO: What GMP (grey market premium) signals about public issue

Market


Bidding for Tarsons Products IPO (Initial Public Offering) is over and all eyes are now set on the share allotment date, which is most likely on 23rd November 2021. The public issue worth 1,023.47 crore got subscribed 77.49 times that has triggered the grey market much before the commencement of share allotment process. According to market observers, shares of Tarsons Products are available at a premium of 210 in grey market today.

Tarsons Products IPO GMP

As per the market observers, Tarsons Products IPO grey market premium (GMP) today is 210, which is 30 lower from its yesterday’s GMP of 240. Market observers said that this is for the first time when Tarsons Products IPO grey market price has dipped ever since it became available for trade in the grey market last week. They said that after closure of bidding, slide in grey market premium was expected but it is heartwarming to see Tarsons Products share price trading at a premium of above 200. They said that strong response from investors and strong company fundamentals have helped the life science stock to hold its fort intact in the grey market.

What this GMP mean?

Market observers maintained that GMP reflects about a tentative idea about the listing gain from the public issue. As, Tarsons Products IPO GMP today is 210, it simply means that grey market is expecting Tarsons Products IPO listing at around 872 ( 662 + 210), which is around 30 per cent higher from its price band of 635 to 662 per equity share.

Highlighting the fundamentals that may help strong listing of Tarsons Products IPO; Astha Jain, Research Analyst at Hem Securities said, “Company is bringing the issue at price band of 635 to 662 per share at P/E multiple of 34 on post issue FY21 EPS (Earnings Per Share). Company being supplier to life science sector has range of labware products across varied customer segments and is operating in an industry which has an addressable market. Also, company is well-equipped and automated manufacturing facilities with geographic reach through strong sales and distribution network has experienced Promoter backed by a strong management team.”

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

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