IPO frenzy shall only gather pace with a number of companies lined up to open their public issues. Amid it, if you had applied for the IPOs of Shyam Metalics and Sona Comstar and had been lucky enough to be allotted their shares, here is given in brief as to what are the listing expectations for the two scrips. Pertinently both the scrips are to debut on June 24, 2021 i.e. tomorrow.
But before we head on to the listing and long term expectations from the two scrips, experts point that listing of an IPO is different from its fundamentals, meaning that a weak market may also compel a strong company to make a weak debut on the D-Street.
1. Listing expectations for Shyam Metalics:
As per some of the websites, the GMP or the grey market premium for Shyam Metalics was at Rs. 132 as on June 21, 2021, just 2 days ahead of its listing. Nonetheless, the stock's stellar response in terms of the subscription numbers and the current upbeat momentum in the market point to a strong listing for the stock. Considering the above premium it translates to a listing price of Rs. 438, given the price of Rs. 306 - upper end of the price band. So, somewhat the listing shall be close to it and hence a debut with gains of around 45%.
Also, though the metal pack in today's trade saw the most weakness, the overall commodity cycle is in an uptrend. Furthermore, steel sector is gaining traction as current steel rates in the country are trading at a discount to import to parity prices and thus companies' in the space have the chance to increase prices.
"Shyam Metalics IPO comes at a time of an upswing in commodity cycle with tailwinds working in favour of steel makers along with extreme bullishness for the sector which argues for a good listing gain candidate," Tapse- VP Research at Mehta Equities told to a leading business portal.
2. Sona Comstar:
As on Sunday (June 20, 2021), the IPO of Sona Comstar commanded a GMP of Rs. 3-5 that to an extent is an indication of its actual listing gains or losses.
In accordance with Tapse as per the report, the scrip of Sona Comstar may see muted listing as risk concerns will outweigh the positive sides of the scrip. What is noteworthy here is that the major portion of the IPO i.e. Rs. 5250 crore is an OFS and hence the proceeds from the IPO shall go to the exiting shareholders and will not be reinvested.
At the upper price band of Rs 291, the asking valuations were not so attractive compared to its peers," Tapse said.