Manba Finance, which offers loans for two-and-three-wheeler segments, is likely to make a strong debut on bourses on September 30. According to analysts, the stock is expected to list up to 50 percent premium from upper band of its issue price of Rs 120 per share.
Ahead of the listing, the shares were commanding 50 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 the listing price.
On the other hand, Amit Goel, Co-Founder and Chief Global Strategist at Pace 360 pegged the stock to list at around Rs 175-180 per share, resulting in a listing gain of around 45 percent. Besides, Akriti Mehrotra, Research Analyst, Stoxbox also expected at 30-35 percent premium.
ALSO READ: Manba Finance IPO bought 224.1 times on final day, check latest grey market premium
According to analysts, investors are advised to hold onto it for the long haul to reap impressive returns.
"At the upper price band company is valuing at P/BV of 1.70x with a market cap of Rs 602 crore post issue of equity shares and return on net worth of 15.66 percent. We believe that IPO is fairly priced hence investors allotted with shares of may hold the shares according to their risk appetite," said Narendra Solanki, Head Fundamental Research - Investment Services, Anand Rathi Shares and Stock Brokers.
The IPO has set a price band of Rs 114-120 per share. The public issue plans raise Rs 150.84 crore solely via fresh issue, thus the entire IPO funds (excluding issue expenses) will be received by the company.
The IPO received an overwhelming response from investors, recording a massive 224.10 times subscription. Investors bought 197.18 crore equity shares during September 23-25, against the offer size of 87.99 lakh equity shares, the subscription data on the exchanges showed. The non-banking finance company closed the subscription for its Rs 151-crore initial public offering on September 25.
The Maharashtra-based company will utilise IPO funds for augmenting the capital base to meet its future capital requirements.
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