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Home >Markets >Stock Markets >Ami Organics vs Vijaya Diagnostic IPOs: What GMP signals before share allotment

Ami Organics and Vijaya Diagnostic's three-day public issues closed on September 3 and all eyes are now set on the share allotment dates of the two which is expected to be on 8 September. Ami Organics IPO got subscribed 64.54 times while Vijaya Diagnostics initial public offer got subscribed 4.54 times. After strong response from the bidders, Ami Organics IPO GMP is once again gaining momentum while grey market's response to Vijaya Diagnostic continues to remain dull. 

Ami Organics IPO GMP today is 173 — 7 up from yesterday's grey market premium of 166. However, Vijaya Diagnostic IPO GMP today is zero — further down from its yesterday's grey market premium of 1 to 2. 

According to market observers, Ami Organics IPO GMP had shot up from 50 to 125 just one day ahead of the public issue opening and went on to scale up to 160 levels. However, after the closure of Ami Organics IPO subscription, its GMP came down towards 125 to 110. So, Ami Organics share price gaining momentum in the grey market before the share allotment date and regaining 150 plus levels must have boosted the morale of those who bid for the public issue, they added.

On the other hand, Vijaya Diagnostic IPO has been receiving dull response ever since it became available for trade in the grey market. Vijaya Diagnostic share price has been nosediving in the grey market and it has come down from a premium of 40 to zero. Market observers believe that higher valuations and 100 per cent OFS (Offer for Sale) may go against Vijaya Diagnostic IPO.

What these GMPs mean

Market observers went on to add that grey market premium of a public issue is an indication about the expected gains from the initial offer. Since, Ami Organics IPO GMP today is 173, it indicates that grey market is expecting Ami Organics share listing at around 783 ( 610 + 173) — near 28 per cent higher from its price band of 603 to 610 per equity share.

Similarly, Vijaya Diagnostic IPO GMP today is zero that means grey market is expecting Vijaya Disgnostic share listing at 531 — indicating par listing for the public issue.

Speaking on Ami Organics vs Vijaya Diagnostic IPOs; Abhay Doshi, Founder at UnlistedArena.com said, "Valuations will play a big role. 100 per cent OFS and valuation on higher side seems working as turned down sentiments for Vijaya Diagnostics. Between the two issues, Ami Organics looks clear winner due to moderate valuation and buzzing chemical space."

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