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Anand Rathi Wealth IPO: 660 crore public issue of India's leading non-bank wealth solution company opened for subscription yesterday and it will remain open for bidding till 6th December 2021. After first day of bidding, the public offer got subscribed 1.60 times. The public offer got subscribed 2.45 times in the retail category, 0.01 times in the QIB category whereas it got subscribed 1.93 times in the NII category. As per the market observers, despite 100 per cent OFS (Offer for Sale) reserved for the public offer, investors are expected to give strong response as they see great scope for the wealth management market in India. They said that grey market is also trying to signal the same as shares of Anand Rathi Wealth have surged in grey market today.

Anand Rathi IPO GMP

Market observers said that Anand Rathi IPO grey market premium (GMP) today is 135, which is 5 higher from its yesterday's grey market premium of 130. They said that Anand Rathi shares have surged from 85 to 135 this week in the grey market without registering any dip on intraday basis. After first day's Anand Rathi IPO subscription status, they expected this trend to further continue as stock market is also giving positive bias.

What this GMP mean?

According to market observers, grey market premium gives an indication about the listing gain that grey market is expecting from the public issue. As Anand Rathi IPO GMP today is 135, it means grey market expects that Anand Rathi shares may list at around 685 ( 5550 + 135), which is around 25 per cent higher from the issue price band of 530 to 550 per equity share.

However, stock market observers advised bidders to look at the financials of the company instead of its grey market performance. They said that grey market premium is an unofficial data and it has nothing to do with balance sheet of the company. They said that it is fundamentals and valuation of a company that tells whether a public issue is strong or weak.

Anand Rathi IPO subscribe or not?

Advising investors to apply for Anand Rathi IPO; Ravi Singhal, Vice Chairman at GCL Securities said, "One can apply for the public issue despite 100 per cent OFS as valuations are looking attractive." However, he maintained that one should have a long-term view in regard to the public issue.

Expecting strong response to Anand Rathi IPO from investors; Abhay Doshi, Founder at UnlistedArena.com said, “The wealth management market has a great scope in India but the competition too is stiff. Moreover, the performance of such companies is in sync to overall market’s performance which is somewhat cyclical in nature. Based on super performance in recent period, we may see good interest for its IPO."

Abhay Doshi went on to add that Anand Rathi Wealth has posted exceptional growth in 5 months’ period ending August, 21 while the performance in last 3 fiscals looked steady. The valuations look fully priced as the issue is priced at 50x PE on the basis of performance of FY21.

Anand Rathi IPO details

Allotment of shares of the wealth management company is likely on 9th December 2021 whereas shares of the company may get listed at NSE and BSE on 14th December 2021.

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint.

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