Northern Arc Capital IPO Grey Market Premium Surges Ahead of Listing
The highly anticipated initial public offering (IPO) of Northern Arc Capital has been creating a buzz in the market, with the company’s shares trading at a significant premium in the grey market. As of September 19, 2024, the Northern Arc Capital IPO Grey Market Premium (GMP) has reached an impressive ₹160, indicating strong investor demand and enthusiasm for the issue.
IPO Details and Subscription
Northern Arc Capital’s IPO, which opened for subscription on September 16, 2024, and closed on September 19, 2024, has been met with overwhelming response from investors. The issue was subscribed 23.39 times on the final day, with strong demand from non-institutional investors and retail investors.The company aimed to raise up to ₹776 crore through the IPO, which included a fresh issue of equity shares worth ₹500 crore and an offer for sale of ₹275 crore. The price band for the IPO was set at ₹249-263 per share, with a face value of ₹10 per share.
Grey Market Premium Soars
The grey market premium of Northern Arc Capital has been steadily increasing, reflecting the market’s confidence in the company’s growth prospects. On September 18, 2024, the GMP stood at ₹202, implying a 76.81% gain over the upper end of the IPO price band. This suggests that the shares are expected to list at a significant premium to the issue price.The estimated listing price based on the GMP is ₹423 per share, which is ₹160 higher than the upper end of the price band. However, it’s important to note that the GMP is not an official price quote for the stock and is based on speculation.
Outlook and Valuation
Northern Arc Capital’s diverse business model, which spans across sectors, products, and borrower categories, has been a key factor in attracting investor interest. The company serves underserved households and businesses with direct and indirect credit access via originator partners.As the company gears up for its listing on the BSE and NSE, investors are eagerly awaiting the final listing price. The strong grey market premium indicates that the shares may list at a premium, potentially offering an attractive opportunity for investors looking to participate in the company’s growth story.However, it’s crucial for investors to conduct thorough research, consult with financial advisors, and read the red herring prospectus carefully before making investment decisions, as investing in IPOs carries inherent risks.
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