Vedanta Fashions IPO: What does the GMP on the public offering, membership status indicate

Vedanta Fashion IPO GMP

Vedanta Fashion’s IPO is GMP today, market observers say 13, which is 5 less than yesterday’s gray market premium 18. He said the fall in Vedanta Fashion’s IPO gray market price can be attributed to two reasons – trend reversal in the stock market and weak response from the bidders. However, he added that there are still two days left for bidding and Vedanta Fashion’s IPO subscription position may pick up if there is any change in the market sentiment. However, he also said that 100 per cent offer for sale (OFS) is another hurdle which can act as a deterrent in pulling off the morale of the investors.

What does this GMP mean?

Market observers said the GMP is nothing but an approximate view of the listing premium that can be expected from a particular public issue. As Vedanta Fashions IPO GMP today 13, means gray market is expecting Vedanta Fashion shares to list around 879 ( 866 + 13), which is approximately equal to the price band of the public issue of from 824 866 per share.

However, secondary market experts said the GMP is not an ideal indicator of expected listing profits from the IPO. He advised investors to look at the company’s financial position as they reflect a solid idea about the company’s financial position and business model.

Speaking on the fundamentals of the company; Ravi Singh, VP and Research Head, Share India said, “Vedanta Fashion commonly known as Manyavar is a well-known name in the festive clothing market. However, financials have been promising since the COVID-19 pandemic. and are not in a downward direction. The company’s net worth and profit margin have also come down. The IPO price band seems to be on the higher side as compared to the valuations.”

Disclaimer: The views and recommendations given above are those of individual analysts or broking companies and not of Mint.