Sansera Engineering IPO - Grey Market Premium

The Rs.1,282.98 crore offer for sale of Sansera Engineering IPO had been priced in the band of  Rs.734 to Rs.744 per share. The issue had closed on 16-Sep and the basis of allotment had been finalized on 21-Sep. With demat credits to eligible shareholders on 23-Sep, the stock is slated to get listed on the bourses on 24-Sep, Friday. Ahead of listing, one of the key information metrices of evaluating the potential listing is the grey market premium (GMP). 

While the GMP is not an official price point, it is a popular informal price point. That is a good gauge of informal demand and supply for the IPO and gives a broad idea of how the listing is likely to be and how the post-listing performance is likely to be. While the GMP is just an informal approximation, it is generally observed to be a good reflection of the real picture. More than the actual price, it is the GMP trend that matters. 

One of the key factors that impacts the GMP is the extent of oversubscription and the Sansera Engineering issue was oversubscribed 11.47 times overall. On a granular basis, it was the QIB segment that saw 26.47X subscription while the other two segments were relatively lower. That has surely made the GMP premiums quite muted in the informal trading market. 

Check Sansera Engineering IPO Subscription

As per updates on Thursday, 22-Sep, the Sansera Engineering IPO is commanding a premium of Rs.38-40 range on the issue price. The GMP was steady at around Rs.35 for the previous 3 days but on Thursday, the stock GMP has spiked sharply to the range of Rs.38-40. The GMP did see a spike after the sterling response to the Paras Defence IPO. 

That translates into a 5.4% premium over the issue price of Rs.744 at the upper end of the price band. Also, it hints at a listing price of approximately Rs.784 when the stock lists on Friday 23-Sep. Of course, subsequent price performance will depend on the selling pressure that emerges during the day. 

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