IPO Watch | Belrise Industries and Borana Weaves - What the GMP tells about both public issues

IPO: Belrise Industries vs Borana Weaves

The IPO market is abuzz with two primary market issues that are currently open for public subscription. While the initial share sale of Borana Weaves has been subscribed around 29.5 times on Day 2, the IPO of Belrise Industries has so far been booked 67 percent on its first day of public bidding.

Belrise Industries IPO GMP

The Rs 2,150 crore IPO of Belrise Industries has been subscribed around 67 percent on its first day of bidding. Non-Institutional Investors (NII) have taken the lead, booking their reserved portion 1.44 times.

The Belrise Industries initial public offering entirely comprises a fresh issue of shares, with a price band of Rs 85-90 per share for the share sale and will remain open for public subscription till May 23. Investors can bid for a minimum of 166 shares, requiring an investment of Rs 14,940, and in multiples thereafter.

Ahead of its listing on exchanges, the unlisted shares of the company were trading with a Gray Market Premium (GMP) in the range of Rs 13-15 per share over its IPO price. According to Investorgain, the unlisted shares were trading with 14.44 percent GMP over the upper end of the IPO price. As per IPO Watch, the shares were trading with a GMP of Rs 15 apiece, higher than the quoted price on May 20.

Should you Apply for Belrise Industries IPO?

Anand Rathi has advised investors to subscribe to Belrise Industries IPO. "The company is focusing on increasing its Content per Vehicle along with focusing on EV’s, 4 Wheelers as Commercial Vehicles. We believe that the issue is fairly priced and recommend ‘Subscribe – Long Term’ rating to the IPO," the brokerage said.

Geojit Financial Services too recommended a 'subscribe' rating for a long-term basis, given Belrise's "dominant market share, diversified product portfolio, strong presence in EV& IC engine segments, capacity expansions, optimize inventory management and favourable industry outlook".

Bajaj Broking too has assigned a 'subscribe' rating for the long term. "Belrise Industries is confident of higher earnings post IPO as it will save on interest cost and recent acquisition will help in boosting its play in four-wheeler segment. Based on its financial data, the IPO appears reasonably priced. Investors may park funds for medium to long term," the brokerage said.

"Belrise Industries presents a compelling IPO opportunity, backed by strong fundamentals and a leadership position in the automotive components space. The company’s strategic focus on EV components, combined with its extensive OEM partnerships and integrated manufacturing, positions it well for sustained growth. The substantial debt repayment through IPO proceeds is expected to enhance profitability and improve cash flows, offering valuation comfort at a forward P/E of 16x. While investor attention is warranted on related-party transactions and customer concentration, the long-term growth potential and diversification into future-ready segments make Belrise an attractive bet for medium- to long-term investors," said Gaurav Garg from Lemonn Markets Desk.

Borana Weaves IPO GMP

Borana Weaves' IPO aims to raise around Rs 145 crore at a price band of Rs 205-216 per share. The textile company’s IPO comprises entirely of a fresh issue of 67.08 lakh shares, and saw strong investor interest on its first day of bidding on May 20. The IPO was booked over 8.5 times by the end of Day 1, with retail portion being booked nearly 25 times.

The investor interest has continued on Day 2 as well, with retail investors leading the subscription rally by booking their reserved portion by a whopping 77 times.

Borana Weaves is raising Rs 144.89 crore via an initial public offering of 67.08 lakh shares at the upper price band. The IPO solely comprises a fresh issue of shares, and will remain open for public bidding till May 22. The textile company has set a price band of Rs 205-216 per share for the IPO.

Investors can bid for 69 shares with a minimum investment of Rs 14,904, and in multiples thereafter. The shares of the company are likely to be listed on stock exchanges on May 27.

The unlisted shares of Borana Weaves were trading with a grey market premium (GMP) in the range of Rs 52-60 per share.

According to Investorgain, the unlisted shares were trading at Rs 273 apiece, implying a GMP of 26 percent over its IPO price of Rs 216 apiece. Notably, this marks a fall from the 27.78 percent GMP quoted by the site on Day 1. According to IPO Watch, the unlisted shares were trading with a GMP of Rs 55 over IPO price at Rs 271 apiece, according to IPO Watch. Notably, this has fallen from Rs 63 GMP quoted by the site on May 20.

Should you Apply for Borana Weaves IPO?

"Borana Weaves' IPO offers a compelling short-term opportunity, with strong listing gain potential driven by robust growth, healthy margins, and attractive GMP. The company's niche positioning and integrated manufacturing give it an edge, but high regional concentration and raw material volatility remain key risks," said Gaurav Garg from the Lemonn Markets Desk.

"At a P/E of 17.5x, valuations seem fair, making it a suitable pick for retail and HNI investors looking to capitalize on debut momentum—while long-term investors may want to monitor execution and expansion before committing," he added.

Anand Rathi advised investors to subscribe to the IPO for long term. "Borana Weaves Ltd is involved in manufacturing and marketing of unbleached synthetic grey fabrics, catering primarily to the B2B segment. The versatility of grey fabric allows it to complement a wide range of unbleached fabrics across different styles, making it a valuable resource in the textile supply chain. This vertical integration gives Borana Weaves better control over quality, cost, and delivery schedules. The company is well-placed to establish direct and strategic regional presence to ensure efficient product delivery and maintain high levels of service responsiveness, thereby reinforcing customer trust and loyalty," the brokerage said.

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