Aditya Birla AMC IPO: What GMP signals as issue opens this week2 min read . Updated: 27 Sep 2021, 08:25 AM IST
- Aditya Birla AMC IPO GMP today is ₹70 — ₹10 up from its yesterday's grey market premium of ₹60
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Aditya Birla AMC IPO (Initial Public Offering) is opening for subscription on 29th September 2021 and it will remain open for subscription till 1st October 2021. Promoters of the asset management company aims to raise ₹2,768.26 crore through OFS (Offer for Sale). Meanwhile, shares of Aditya Birla Sun Life AMC are available for trade in the grey market. ABSL shares are trading in the grey market at a premium of ₹70 — against their price band of ₹695 to ₹712 per equity share.
Aditya Birla AMC IPO GMP (grey market premium)
According to market observers, Aditya Birla AMC IPO GMP today is ₹70 — ₹10 up from its yesterday's grey market premium of ₹60. Market observers went on to add that Aditya Birla AMC shares become available for trade in the grey market last week with a premium of ₹30 apiece. So, in one week time, Aditya Birla AMC IPO grey market premium has shot up from ₹40 to ₹70 — logging 75 per cent rise before the public issue could open for subscription. Market observers said that much will depend upon the subscription status and kind of response it gets from investors. They said that 100 OFS may work as hurdle in higher subscription of the public issue.
What this GMP mean
Market observers said that GMP is an unofficial indication about the possible listing gain from the IPO. As Aditya Borla AMC IPO GMP today is ₹70, this means grey market is expecting this public issue listing at around ₹782 ( ₹712 + ₹70) — around 10 per cent higher from its issue price of ₹695 to ₹715 per equity share. However, market observers warned that GMP should not be the criteria for IPO bidding. They said that it's financials of the company that matters most. They advised investors to go through the balance sheet of the company and then decide whether they should apply for the public issue or not.
Speaking on the fundamentals of Aditya Birla AMC; Abhay Doshi, Founder at UnlistedArena.com said, "The AMC arm of Aditya Birla group is amongst the top 4 AMCs in India by QAAUM (Quarterly Average Asset Under Management). As on June 30, 2021, it managed total AUM of ₹2936.42 billion. With the rise in financial literacy and awareness, we witnessed a huge growth in aggregate industry AUM in recent period. The composition of ABSL AMC has more weigh on debt funds, which have comparatively lesser margins as compared to equity schemes. But it looks like the company is tilting the focus on high-margin products."
Abhay Doshi further added, “At the upper band of ₹712, the issue looks priced in-line with its listed peers. On the basis of FY21 earnings, the issue is asking a PE multiple of 39, which seems moderate leaving a little room for short-term investors. The long term prospect of the company tends to be impressive owing to huge under-penetration in Capital Markets but at the same time, there are many alternatives present to play this theme."
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