IPO GMP, Latest IPO Grey Market Premium
The grey market premium, often referred to as IPO GMP, is a figure that reflects the demand for a company’s IPO. It’s calculated in the unofficial and unregulated market after the IPO’s date and price band have been announced. Investors interested in IPOs often pay close attention to the IPO GMP as it can provide insights into market conditions, demand, and the subscription numbers for that particular IPO. However, it’s important to note that the grey market premium can fluctuate based on these factors, and it’s not an official or regulated indicator.
Current IPO GMP Today
| IPO Name | IPO Type | IPO GMP | IPO Price | Listing Gain |
|---|---|---|---|---|
| DOMS IPO 13-15 Dec | Mainline | ₹150 | ₹- | -% |
| Swashthik Plascon 24-29 Nov | BSE SME | ₹12 | ₹86 | 14% |
| Deepak Chemtex 29-1 Dec | BSE SME | ₹60 | ₹80 | 75% |
| AMIC Forging 29-1 Dec | BSE SME | ₹100 | ₹126 | 79% |
| Net Avenue Technologies 30-4 Dec | NSE SME | ₹10 | ₹18 | 56% |
| Graphisads 30-5 Dec | NSE SME | ₹– | ₹111 | -% |
| Marinetrans India 30-5 Dec | NSE SME | ₹– | ₹26 | -% |
| Sheetal Universal 4-6 Dec | NSE SME | ₹12 | ₹70 | 17% |
| Accent Microcell 8-12 Dec | NSE SME | ₹100 | ₹140 | 71% |
| Allied Blenders and Distillers | Mainline | ₹– | ₹- | -% |
| Muthoot Microfin | Mainline | ₹– | ₹- | -% |
| Motisons Jewellers | Mainline | ₹– | ₹- | -% |
| SPC Life Sciences | Mainline | ₹– | ₹- | -% |
What is IPO GMP ?
IPO GMP stands for “Grey Market Premium.” It represents the difference between the unofficial or secondary market price of an initial public offering (IPO) share and the official IPO price set by the company. The Grey Market is an informal market where individuals and investors trade shares of an IPO before they are officially listed on a stock exchange. The Grey Market Premium indicates how much investors are willing to pay for IPO shares in the unofficial market, often based on their expectations for the stock’s performance when it starts trading on the exchange. It can provide insights into the demand for a particular IPO and can fluctuate based on market sentiment and other factors.
Important Points to Consider about IPO GMP:
- Grey market transactions are unofficial and involve IPO investors and stockbrokers. Trust is crucial in these transactions.
- Before applying for an IPO, it’s advisable to read IPO analyses and conduct thorough research.
- Grey market rates are calculated and provided by market research experts or sources.
- It’s important to note that trading in the Grey Market is illegal.
- The Kostak Rate is the premium obtained by selling one’s IPO application in an off-market transaction to someone else, even before allotment or listing of the issue.
- The premium in the Grey Market may change at any time before the listing, so it’s important not to subscribe to the IPO solely based on this premium.
- When subscribing to an IPO, it’s wise to consider the fundamentals of the company as a primary factor in your decision-making process.
IPO Grey Market FAQs:
What Factors are Influencing IPO GMP?
Several factors contribute to the IPO Grey Market Premium, including:
- Company Fundamentals: Strong financials, growth prospects, and a reputable management team can positively impact the Grey Market Premium. Investors often assess a company’s financial health and potential for growth before participating in its IPO.
- Market Conditions: Overall market sentiment, sector performance, and economic factors significantly influence investor appetite for IPOs. In a bullish market, investor confidence is generally higher, leading to increased demand for IPO shares and potentially higher Grey Market Premiums.
- Demand and Supply Dynamics: The number of shares available and the level of investor interest play a crucial role in determining the Grey Market Premium. If an IPO is oversubscribed, meaning there is high demand for the shares, it can drive up the Grey Market Premium. Conversely, an undersubscribed IPO may result in a lower premium or even a discount in the Grey Market.
How to Calculate Grey Market Premium?
The IPO Grey Market Premium (GMP) is the price at which shares are traded in the unofficial grey market before the official IPO listing. GMP is calculated based on various factors, including the company’s performance, demand in the grey market, and the expected subscription levels.
For instance, if the IPO price for a hypothetical company, let’s call it “X IPO,” is set at ₹200, and the grey market is indicating a GMP of ₹100, it suggests that the IPO might list at ₹300 (i.e., ₹200 + ₹100). However, it’s important to understand that this is a speculative estimate, and the actual listing price can differ from the grey market price.
How Do I Buy / Sell IPO Application in Grey Market?
In the grey market for IPOs, there are no official entities or businesses involved. Grey market activities are typically facilitated by local brokers or individuals who act as intermediaries between buyers and sellers of IPO applications. These brokers help in trading IPO applications at rates based on factors like the IPO Grey Market Premium (GMP).