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What GMP signals as all eyes set on allotment date

ASG Transact Tech IPO: Bidding for the public issue worth 680 closed yesterday and now all eyes are set on ASG Transact Technologies IPO, which is likely on 27th January 2022. As per ASG Transact Technologies IPO subscription status, the book built issue has been subscribed 7.79 times whereas its retail portion was subscribed 3.08 times. As per the market observers shares of ASG Transact Technologies are available at a premium of 15 in grey market today. They said that after strong response to the public issue on second and third day, ASG Transact Technologies IPO grey market premium (GMP) has almost doubled from 8 to 15 in just a gap of one day.

ASG Transact Technologies IPO GMP

According to stock market experts, ASG Transact Technologies GMP today is 15, which is 5 higher from its yesterday’s grey market premium of 10. Market observers went on to add that ASG Transact Technologies IPO grey market price has almost doubled in one day after strong response from the investors to this public issue on second and third day of bidding. The public issue, which is 100 per cent offer-for-sale, has been subscribed 7.79 times, which has gone down well in the grey market. They said that much will depend on the market mood as the grey market price has gone up despite heavy selloff in the secondary market for last four sessions. They said that if there is trend reversal in next week, then the ASG Transact Technologies IPO may further scale northward and gain its lost ground as it had made its debut in the grey market at 23.

What this GMP mean?

Market observers went on to add that grey market premium is nothing but an unofficial estimation by the grey market players in regard to expected listing premium from the issue. As ASG Transact Technologies IPO GMP today is 15, it means grey market is expecting that ASG Transact Technologies shares will list at around 190 ( 175 + 15), which is around 8.50 per cent higher from ASG Transact Technologies IPO price band of 166 to 175 per equity share.

However, secondary market experts maintained that GMP is not a right variable to find out whether a public issue will succeed or not. They said that its balance sheet of the company that matters and advised investors to stick with the basics.

Highlighting the fundamentals in regard to ASG Transact Technologies IPO; Abhay Doshi, Founder at said, “AGS Transact Technologies is an omni-channel payment solutions provider having diversified portfolio in payment and automation solutions. The pandemic has impacted the business due to slowdown in economic activities resulting in lack of growth in top as well as bottom line of the company. The issue is priced at a PE multiple of 38 based on FY21 earnings and has incurred a loss of around 18 crores in 5MFY22. Owing to these factors, the IPO may get a moderate response. However, the revenues from digital solutions will be a key thing to watch for going ahead.”

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

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