Six IPOs Open for Subscription: GMPs as High as 28%

Six initial public offerings opened for subscription on Monday, with grey market premiums reaching as high as 28% on one of the issues. The slate spans manufacturing, technology, and financial services, with total fundraising expected to cross ₹1,200 crore.

The largest of the six is a ₹450-crore IPO from an engineering firm. A tech services issue follows at ₹320 crore. The remaining four are smaller, each below ₹200 crore. Grey market activity has been strongest for the engineering stock, where the 28% GMP implies a listing-day gain of roughly a quarter above the upper price band.

GMPs are informal indicators, not regulated. They reflect demand from a narrow set of high-net-worth participants. The premium can shift sharply between the close of bidding and listing day. A 28% GMP does not guarantee a 28% pop. The actual listing gain depends on subscription data, particularly institutional participation. If qualified institutional buyers show strong demand, the premium tends to hold. If retail drives the subscription, the GMP may fade.

For traders, the size of the IPO matters for post-listing liquidity. Four of the six issues have an offer size below ₹150 crore. Daily trading volumes in that range can be thin. Exits become harder if the stock gaps down on debut. The engineering and tech services issues, by contrast, have enough size to attract market-maker support.

The tech services IPO competes in the same IT services space as Infosys and Wipro. Infosys carries an Alpha Score of 57 (Moderate) on AlphaScala, while Wipro scores 46 (Mixed). The new issue will need to differentiate on valuation and growth to command a premium over these listed peers. Their stock pages on AlphaScala provide detailed analysis for comparison.

Investors should compare the IPO's price-to-earnings ratio with listed peers in the same sector. A premium over the sector average may be justified by higher growth or margins. The GMP already prices in some of that optimism. The risk is that the premium is already baked in. The subscription window closes Thursday for all six. Allotment is expected the following week, with listings on the BSE and NSE within 10 days of the close.

The broader market is near highs, which could support demand. Yet a correction after listing remains a risk if sentiment shifts. The next few days of subscription data will provide the clearest signal on whether the GMPs hold or fade.