Allied Blenders and Distillers is likely to make a positive start on its market debut on the bourses on July 2. Analysts expect the shares to list at a 15-20 percent premium over the IPO price, somewhere between Rs 340 and Rs 350.
Ahead of the listing, the shares were commanding a 17.4 percent premium in the grey market, an unofficial ecosystem where shares start trading before the allotment in the IPO and continue till the listing day. Most investors track the grey market premium (GMP) to get an idea of the listing price.
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Parth Shah, a research analyst at StoxBox said that shares are anticipated to list at a premium of approximately 15 percent above the subscription price following robust investor interest. As one of the largest Indian-owned and India-made foreign liquor (IMFL) companies, it is among the four spirit companies in India with a nationwide sales and distribution network and is also a leading exporter of IMFL.
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He also added that with internal practices and the promising macro situation, the company is set to experience growth in the coming period. However, as the issue seems to be expensive on the valuation front, we would advise the market participants to book profits on the listing day.
The initial public offering of Allied Blenders and Distillers was subscribed 23.55 times with investors bidding for 92.71 crore equity shares against the offer size of 3.93 crore shares.
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Non-institutional investors led the support for the issue, purchasing 32.40 times their allotted portion. Qualified institutional buyers bid 50.37 times their reserved portion, while retail investors subscribed to 4.51 times their allocated shares.
Amit Goel, chief global strategist at Pace 360 said that the even as the company received a positive response to the issue, Allied Blenders has, in the past, posted "very thin margins".
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"We expect the shares to list at around Rs 340-350 per share, resulting in a listing gain of approximately 20 percent. Post listing, we recommend investors book profits and avoid long-term investment in this stock," he added.
Allied Blenders has already mopped up Rs 499.1 crore through its anchor book on June 24. Societe Generale, Goldman Sachs, Troo Capital, BNP Paribas, 360 One Special Opportunities Fund, LIC Mutual Fund, and Jupiter India were amongst the investors in the anchor book.
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