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    Clean Science IPO: Grey market premium at Rs 470 as bidding underway

    Clean Science IPO: Grey market premium at Rs 470 as bidding underway

    Clean Science IPO: Grey market premium at Rs 470 as bidding underway
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    By CNBCTV18.com  IST (Updated)


    A strong grey market performance signals a cracking IPO. Company has set price band at Rs 880-900/share.

    Pune-based Clean Science and Technology (CSTL) launched its initial public offering (IPO) on July 7. The bidding for the IPO will continue for three days till July 9. The price band is fixed at Rs 880-900 per share.
    However, the shares are being sold at a premium of Rs 470 -- or 52 percent -- on the grey market, according to IPO Watch. The grey market premium (GMP) for the shares of the company even stood at Rs 490 on July 6, a day before the start of the IPO.
    This is an offer for sale (OFS) by existing investors and promoters and not an offering of fresh shares by the company. The investors and promoters are looking to raise about Rs 1,546 crore, though the company itself will not receive any of these proceeds. The OFS has been issued by Anantroop Financial Advisory Services, Ashok Ramnarayan Boob, Krishnakumar Ramnarayan Boob, Siddhartha Ashok Sikchi and Parth Ashok Maheshwari, who are all existing investors of the company.
    After the IPO, the shareholding percentage of the promoter group will drop to 78.51 percent from 94.65 percent. A total of 1.71 crore equity shares are on offer. Fifty percent of the shares are reserved for qualified institutional buyers (QIBs) while 15 percent are reserved for non-institutional investors, and 35 percent for retail investors.
    Grey market refers to the unofficial market where shares are traded along with other financial securities. A strong grey market performance suggests an excellent IPO for the company.
    Manan Doshi, the co-founder at UnlistedArena.com, said, "The company has a track record of strong and consistent financial performance. The issue is priced at 48 times P/E against the average industry P/E of 55 times. Considering the stellar performance, the asking price does not look expensive. If such performance remains consistent, we may see the stock outperforming going ahead."
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