SP Tulsian view on Galaxy Surfactants

Galaxy Surfactants is a case of a mispricing, says SP Tulsian, sptulsian.com.

Tulsian told CNBC-TV18, "Galaxy Surfactants is a case of a mispricing because if you take their financials for FY11, they are likely to the kind of performance they are likely to post. If I take the upper band of Rs 340, share is being issues at a PE Multiple of 10.5. That means obviously prospective investor will expect the share to list at about 12 PE multiple post IPO allotment."

He further added, "If you see the stocks in this space, they have all been ruling, may not be the identical stock but in the similar kind of space they have been ruling, maybe taking the case or specialty chemical of something like that, they have been ruling at a PE multiple of 6 to 9. So it would have been proper on part of the company to price the stocks somewhere between Rs 280 to Rs 300, probably that would have attracted the investors to come and invest into the stock, at least from the institutional investor."

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