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Tamilnad Mercantile Bank shares trade at premium in grey market ahead of IPO

Tamilnad Mercantile Bank shares trade at premium in grey market ahead of IPO

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By CNBCTV18.com Sept 5, 2022 8:49 AM IST (Updated)

Tamilnad Mercantile Bank IPO: The TMB IPO will open for subscription on September 5 and close on September 7. Potential investors will be able to bid for Tamilnad Mercantile shares in a price band of Rs 500-525 apiece in multiples of 28 under the IPO.

Tamilnad Mercantile Bank (TMB) — one of the country's oldest private sector lenders — is all set to hit Dalal Street to raise up to Rs 832 crore through an initial public offering (IPO) on Monday, September 5. The initial share sale — which comprises fresh issuance of shares — will close on September 7.

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Dealers said Tamilnad Mercantile Bank commanded a premium of Rs 35 in the grey market on Friday.
The lender has set a price band of Rs 500-525 per share for the IPO, in which potential investors will be able to bid for shares in multiples of 28. That makes each lot of TMB shares worth Rs 14,000-14,700.
"The Tamilnad Mercantile Bank issue is priced at 1.4 times its book value, which seems to be moderate," Abhay Doshi, Co-Founder of Unlisted Arena — a portal that tracks grey markets and deals in unlisted securities — told CNBCTV18.com.
On Friday, Tamilnad Mercantile Bank said it had raised Rs 363.5 crore by allocating 71.3 lakh shares to anchor investors, including Nomura, Societe Generale, Max Life Insurance, Kotak Mahindra Life Insurance and Bajaj Allianz Life, at Rs 510 apiece.
Tamilnad Mercantile Bank's will be the third initial share sale to hit the Street within a span of three weeks, following a lull of almost three months.
Last month, the IPOs of Syrma SGS Technology and DreamFolks Services received a robust response from investors, winning bids for 32.6 times and 56.7 times the shares on offer respectively.
Syrma shares made a strong debut in the secondary market, finishing the listing day at a premium of about 42 percent over the issue price.
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