The initial public offering (IPO) for Suraksha Diagnostic Ltd., which opened on November 29th, has not seen much interest in the grey market with its grey market premium (GMP) remaining at zero. This indicates a lack of investors willing to pay more than the issue price for the company's shares. Despite being the most diversified among its competitors, with strong revenue growth and financials, the company's grey market premium reflects current market sentiments. Analysts from Axis Capital and SBI Securities have recommended the IPO, but at the upper price band of Rs 441, Suraksha is valued at a high P/E and EV/Sales multiple, which may have deterred potential investors.
Suraksha Diagnostics IPO: Grey Market Premium Remains Stagnant
Suraksha Diagnostic Ltd., a leading provider of diagnostic services in India, launched its initial public offering (IPO) on November 29, 2022. However, the IPO has not garnered significant interest in the grey market, with its grey market premium (GMP) remaining at zero.
Background
Suraksha Diagnostics is a diversified diagnostic company that operates over 100 diagnostic centers across India. It offers a wide range of tests, including pathology, radiology, and genetic testing. The company has a strong track record of revenue growth and profitability.
IPO Details
The Suraksha Diagnostics IPO opened on November 29th and closed on December 1st. The company offered 36,960,000 shares at a price band of Rs 430-441 per share. The issue size was estimated to be around Rs 1,600 crore.
Grey Market Premium (GMP)
GMP is the difference between the issue price of a stock and its expected trading price on the first day of listing. It reflects the demand for the stock in the grey market. For the Suraksha Diagnostics IPO, the GMP has remained at zero throughout the subscription period.
Reasons for Low GMP
Analysts believe that several factors may have contributed to the low GMP for the Suraksha Diagnostics IPO:
Analyst Recommendations
Despite the low GMP, analysts from Axis Capital and SBI Securities have recommended the IPO. They believe that the company's strong revenue growth and financials make it a compelling investment opportunity.
FAQs
1. What is the GMP for Suraksha Diagnostics IPO? The GMP for Suraksha Diagnostics IPO is zero.
2. Why is the GMP so low? The GMP is low due to factors such as high valuations, market sentiments, and lack of clarity.
3. Should I invest in the Suraksha Diagnostics IPO? Analysts have recommended the IPO, but investors should consider their own risk tolerance and investment objectives.
4. When will the Suraksha Diagnostics IPO list? The Suraksha Diagnostics IPO is expected to list on the BSE and NSE on December 8, 2022.
5. What are the key risks associated with the Suraksha Diagnostics IPO? Key risks include competition from larger competitors, potential slowdown in growth, and regulatory changes.
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