In 48 hours Hyundai Motor is going to make history on D Street, when on Wednesday, October 15, it will throw open the bidding process for its IPO to mop up Rs 27,870 crore. While the proposed issue from the South Korean auto maker – the second largest passenger car brand in India – hit the headlines several months ago, it is assumed that the IPO will trigger big investor interest.
The only unofficial indicator for investor interest is the Grey Market Premium or GMP that is studied by a large number of investors in the run-up to the issue. While a positive GMP indicates that the shares will list at a higher price over and above the upper end of the price band, a negative GMP indicates a fall in price on listing.
GMP from September 26
Significantly, data from Investorgain, which documents GMP data for every IPO in the market, has shown that the GMP of Hyundai Motor has been highly volatile since September 26, 2024, which is the first day from which data has been maintained.
While GMP was Rs 0 on September 26, it shot up to Rs 570 on the very next day and turbulence began right away. On September 28, it moved down to Rs 500 and further to Rs 385 on September 29.
Continuous drop of GMP
On September 30 and October 1, the GMP dropped to Rs 380 and Rs 363. On October 2, it inched up to Rs 370 but again fell to Rs 360 on October 3.
The yo-yo in the GMP continued. On the next few days, the GMP were recorded at Rs 365 (October 4), Rs 270 (October 5), Rs 289 (October 6), Rs 270 (October 7), Rs 147 (October 8), Rs 175 (October 9) and Rs 132 (October 10). The GMP dropped to Rs 75 on October 11.
Indicates lukewarm investor interest
It continued to drop on October 13, recording Rs 67, that indicates a listing gain of only 3.42%. The price band for Hyundai shares is Rs 1,900 to Rs 1,960. The bidding process will remain open from October 15 to October 18. The listing will take place on October 22 and Hyundai Motor share allotment will be decided on October 18.
However, it must be mentioned that GMP indicates only the listing gains/losses and does not guarantee anything and IPOs should be assessed for long-term prospect.
(Disclaimer: This article is only meant to provide information. News9live.com does not recommend buying or selling shares or subscriptions of any IPO and Mutual Funds.)
Though it is an unofficial indicator, most experts consider GMP (Grey market Premium) an indicator of investor interest in the run-up to an IPO. Markets Business News – Personal Finance News, Share Market News, BSE/NSE News, Stock Exchange News Today
