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Paytm Listing: Premium Broken in Gray Market, Not Listing at Discount?

Highlights:

  • Investors did not show much interest in the country’s biggest IPO
  • Zomato will be the 49th stock to be listed in 2021, listing is happening on Thursday
  • The company had offered shares worth Rs 2,150, but the prices fell sharply day by day in the gray market

Ahmedabad: The IPO of Paytm-operated One97 Communications is scheduled to open on November 18. However, a few hours ago its premium went down in the gray market. This is the country’s biggest IPO of Rs 18,300 crore, which did not get the desired response. Paytm has become the 49th IPO of the year with a back-to-back IPO in 2021, which will be listed on Thursday after the allotment of shares.

There is a lot of discussion about whether Paytm’s IPO will open at a discount or whether its shareholders will get any earnings. Its premium has reached the lowest level in Teva’s gray market. The company had offered shares in the IPO at a price of Rs 2,150. However, before the opening of the IPO, there was talk of its high prices in the gray market. But it has seen a gradual decline and today its GMP is at an all-time low.

According to sources, Paytm’s stock is currently trading around Rs 2180 in the gray market. This means that it is trading at just Rs 30 or 1.4 per cent more than the offer price. The share price was Rs 150 in gray market on 7th November and it fell to Rs 80 on 7th November. Then it gradually declined. As soon as the issue opened, its price in the gray market became Rs 40 and on November 10, the share price became Rs 40 plus.

It is noteworthy that the issue of Paytm is barely subscribed and in view of this, the gray market is also witnessing a decline. All eyes are on whether the stock will list at a discount tomorrow or the policy will surprise the market. Experts say that even if the stock opens in Plus, there is not much momentum to be seen in it. Even when the IPO came around, many experts voted that the shares were overvalued. There is also a view that the share price is likely to rise by 5-10 per cent once the issue opens flat.

In 2021, Paytm is the fourth company to be recognized as a new age company after Zomato, Policybazar, Nayaka. Zomato and Nayaka have made money for investors in the above four IPOs. However, there was no significant gain in the policy market. Whereas Nayak is the only company that makes profits. In this case, the company reported a loss of Rs 4,230 crore in FY19, which came down to Rs 1,701 crore in FY21.

Disclaimer: This news is for information only. It does not intend to make any recommendation for the sale of shares. Be sure to consult your financial advisor before making any investment.

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