C2C Advanced Systems IPO GMP crashes 60% after SEBI action

C2C Advanced Systems IPO GMP has declined after SEBI action.

C2C Advanced Systems IPO GMP witnessed a sharp decline on the final day of its subscription on Tuesday. This comes after the Securities and Exchange Board of India (SEBI) directed the defence solutions provider to appoint independent auditors and obtain an independent report on its financial accounts.

C2C Advanced Systems, which aims to raise Rs 99.07 crore through its IPO, had set a price band of Rs 214-226 per equity share. The issue is slated to be listed on the National Stock Exchange's Emerge platform.

Market observers tracking grey market activity reported that the company’s shares commanded a GMP of Rs 245 as of November 24, translating to a premium of over 100 percent, although listing gains are capped at 90 percent.

However, the premium has since plunged to Rs 100 as of November 26, reflecting a potential listing gain of approximately 45 percent, according to the data available on Investorgain. This marks a decline of nearly 59.18 percent in just two days.

The sharp drop in GMP follows SEBI’s intervention after receiving a complaint from an investor. On November 25, SEBI asked the company to address the concerns by appointing independent auditors and obtaining a third-party review of its financial records. The action has sparked apprehension among investors, with many voicing concerns on social media platform X (formerly Twitter).

In a corrigendum to its red herring prospectus, the company announced that all non-anchor investors who have applied to the IPO can withdraw their applications. This withdrawal option is available until 3 PM on Tuesday, November 28, 2024.

C2C Advanced SME IPO: You can withdraw your application by 3 pm on Nov 28 post-SEBI action; here's how

The IPO had garnered significant interest before the SEBI directive, with investors anticipating robust listing gains. However, the regulatory intervention and subsequent decline in GMP have cast doubts over its listing timeline. While the company was scheduled to debut on the NSE Emerge platform on November 29, market sources suggest that this could now face delays.

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