Divgi TorqTransfer Systems IPO: What does GMP indicate after share allotment

Divgi TorqTransfer Systems IPO GMP

Market observers said Divgi TorqTransfer Systems IPO GMP (grey market premium) today 45, which is 25 less than its Thursday GMP 70 per equity share. He said that Divgi TorqueTransfer Systems IPO GMP fell today due to weakness in secondary market sentiment since last two days. Observers further said that in the previous sell-off, the gray market remained strong with respect to the Divgi TorqTransfer Systems IPO. However, he added that despite heavy selling in the last two days, the gray market sentiment is still positive and it is expecting a premium on the listing date of this public issue.

What does this GMP mean?

As today Divgi TorqTransfer Systems IPO GMP 45, means the gray market is expecting Divgi TorqTransfer Systems IPO listing will be around 635 ( 590+ 45), which means it is around 7% higher than its price band since 560 590 per equity share. He added that after the trend reversal on Dalal Street, the gray market sentiment may pick up again.

However, stock market experts advised allottees of Divgi TorqTransfer Systems IPO to stick to their convictions developed after scanning the balance sheet of the company. He added that GMP is not an ideal indicator regarding potential listing gains from an IPO as it is non-regulated and purely speculative. He further said that GMP can also be artificial as sometimes it involves people who have high stake in the public issue.