Whenever a company launches an IPO, investors closely monitor it. Through an IPO, the company offers its shares to the market for the first time. However, before investing, it is essential for investors to understand the market sentiment and the actual demand for the shares they are considering. This is where Grey Market Premium (GMP) plays a key role.
This is the page where you can get the IPO Live GMP of every IPO about to hit the stock market.
IPO LIVE GMP
| IPO Name | Price Band | GMP | Estimated Listing Price & Gain% | Listing Date | Updated GMP |
| Concord Enviro Systems IPO | ₹665 to ₹701 | ₹70 | ₹771 (10%) | 27 December | 1 Hour Ago |
| Sanathan Textiles IPO | ₹305 to ₹321 | ₹30 | ₹351 (9%) | 27 December | 1 Hour Ago |
| Newmalayalam Steel IPO | ₹85 to ₹90 | ₹0 | ₹0 (0%) | 27 December | 1 Hour Ago |
| DAM Capital Advisors IPO | ₹269 to ₹283 | ₹108 | ₹391 (38%) | 27 December | 1 Hour Ago |
| Mamata Machinery IPO | ₹230 to ₹243 | ₹111 | ₹354 (46%) | 27 December | 1 Hour Ago |
| Transrail Lighting IPO | ₹410 to ₹432 | ₹120 | ₹552 (28%) | 27 December | 1 Hour Ago |
| Identical Brains Studios IPO | ₹51 to ₹54 | ₹38 | ₹92 (70%) | 26 December | 1 Hour Ago |
| NACDAC Infrastructure IPO | ₹33 to ₹35 | ₹56 | ₹67 (60%) | 24 December | 1 Hour Ago |
Table of Contents
Grey Market Premium
Grey Market Premium (GMP) is the difference between the offer price of the IPO shares and their actual trading price in the grey market. In simple terms, it indicates how much premium investors are willing to pay for the company’s shares.
For example, if a company offers its shares at ₹100 per share through an IPO, and in the grey market, investors are willing to buy the same shares for ₹200, then the GMP would be ₹100. This means that the actual market price of the shares is expected to be 100% higher than the offer price.
Importance of GMP
GMP is a vital indicator for investors. It does not necessarily indicate whether the IPO is good or bad but provides insights into the market’s interest in the shares. A high GMP suggests that the shares may be priced higher when listed, reflecting good market demand. On the other hand, a low or negative GMP could signal weak interest in the IPO.
How does GMP Work?
GMP is determined by investors trading IPO shares in the grey market, which is an unofficial and unregulated market where shares are bought and sold before they are officially listed in the stock exchange. Here’s how GMP is calculated:
- Offer Price: The price at which the company offers its shares for the IPO. For example, let’s say the company is offering shares at ₹100 each.
- Grey Market Selling Price: The price at which shares are being traded in the grey market. Let’s assume they are being traded at ₹200.
- Calculation: GMP is calculated as:
GMP = ((Grey Market Price−Offer Price)*100) / Offer Price
GMP= ((200−100)*100) / 100 = 100%
This way GMP reflects the premium on the shares before their official listing.
Can GMP be Relied Upon?
Many investors wonder whether they can rely on GMP for making investment decisions. The answer is straightforward “No”.
- Informal Nature of the Grey Market: The grey market is informal and unregulated. Prices here are often influenced by investor sentiment and market conditions, making them unreliable at times.
- Official Listing: The GMP only provides an estimate before the IPO is listed. After the listing, the actual market price could differ significantly from the GMP.
- Demand for Shares: High GMP does not always guarantee high returns post-listing. Sometimes, the demand for shares in the grey market might not reflect the actual market conditions, once the stock is officially listed.
- Market Volatility: Stock market fluctuations can affect the GMP and its prediction, causing changes in the price once the IPO is listed.
Should GMP be the only basis for Investment Decisions?
While GMP can provide some insights, it should not be the sole factor in making investment decisions. Investors should also consider other factors such as the company’s financial performance, industry outlook and the IPO’s price band. GMP serves as an indicator of market interest but investors should evaluate it along with other financial and qualitative aspects of the company.
Risks Associated with GMP
Investing in the grey market has its risks:
- Uncertainty: As the grey market is unregulated, there is no reliable data to guide investment decisions.
- Fraud: The informal nature of the grey market also opens up the possibility of fraud, and investors must remain cautious.
- Post-Listing Performance: A high GMP in the grey market does not guarantee similar performance after the stock is listed on the exchange. The actual listing price could be different from the grey market expectations.
Conclusion
GMP can be an important tool for understanding market sentiment, but it should not be the sole basis for making investment decisions. Investors should consider it as one of the many factors, including the company’s fundamentals, financial health, market conditions, and industry outlook. As with any investment, it is essential to conduct thorough research and consult with a financial advisor before making a decision, as the stock market always carries inherent risks.
Note: The GMP data provided above is based on personal estimates and news from the grey market. Please do not rely solely on the GMP provided here. The grey market and stock market involve significant risks, and it is advisable to consult a financial advisor before making any investments to avoid potential losses.
