What GMP Suggests About its Market Debut

Syrma SGS Technology Listing Tomorrow: Syrma SGS Technology, a Chennai-based technology-focused engineering and design company engaged in turnkey Electronics Manufacturing Services (EMS), was subscribed 32.61 times on the final day that closed last week. The Rs 840 crore-IPO received bids for 93,14,84,536 shares against 2,85,63,816 shares on offer. Syrma SGS Technology’s offer consists of a fresh issue of equity shares aggregating up to Rs 766 crore and an offer for sale of up to 33.69 lakh equity shares by promoter Veena Kumari Tandon.

The company said that the net proceeds from the fresh issue will be utilised for funding capital expenditure requirements to expand manufacturing, R&D facilities, long-term working capital requirements, and general corporate purposes.

GMP Today

Shares of Syrma SGS Tech are commanding a premium (GMP) of Rs 48 in the grey market today, as per market observers. Analysts suggested that maintaining the issue price below the pre-IPO placement price, stronger financial performance, solid customer relationships, a varied product range, and experienced promoters could be the root causes of the company’s premium in the grey market.

An unofficial trade platform is the grey market. Trading commences with the publication of an IPO’s price range and continues up until the listing of the shares.

Manoj Dalmia, Founder and Director-Proficient Equities, said: “Syrma Grey Market Premium (GMP) of the public issue has gone up from Rs 20 to Rs 55 per equity share in grey market. According to the market observers, after closure of the public issue, Syrma SGS Technologies IPO GMP has remained steady around Rs 55 despite two days sell-off in the market. Now the IPO has moved from Rs 50 GMP to Rs 55 We expect the listing to be around Rs 260-270 range. Based on its financial data and earnings, the issue is priced at a P/E of 50+ even at lower IPO pricing.”

What Do Analysts Say About Listing Gains?

Ravi Singhal, CEO, GCL, said: “Stocks looks good it list around Rs 320. Long-term investors keep invested while short term traders can book full profit.”

Dalmia said: “The segment in which SSTL is operating is also poised for bright prospects ahead and investors may consider it with medium to long-term perspectives.”

Abhay Doshi, Founder, UnlistedArena.com, dealing in Pre-IPO & Unlisted Shares, said: “D-Street will witness an IPO listing after a long pause. Syrma SGS has received a decent response across all categories. Owing to the response, Syrma SGS is likely to list at 20-25 per cent premium over the issue price if the market conditions remains favourable.”

The shares of the company are expected to list on stock exchanges BSE and NSE on Friday, August 26, 2022.

Syrma SGS Technology, incorporated in 2004, is a Chennai-based technology-focused engineering and design company engaged in turnkey Electronics Manufacturing Services (EMS). Its customers include TVS Motor Company, AO Smith India Water Products, Robert Bosch Engineering and Business Solution, Eureka Forbes and Total Power Europe BV.

It operates through eleven manufacturing facilities in Himachal Pradesh, Haryana, Uttar Pradesh, Tamil Nadu and Karnataka and has three R&D facilities which are located in Tamil Nadu, Haryana, and Germany.

The views and investment tips by experts in this News18.com report are their own and not those of the website or its management. Users are advised to check with certified experts before taking any investment decisions.

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