Suraj Estate Developers’ Lackluster Debut in Market

Suraj Estate Developers' Lackluster Debut in Market

VoM News Desk | December 26, 2023 | 11:38 AM IST | Breaking News | Follow on Google News

Suraj Estate Developers’ Lackluster Debut in Market/Mint

Suraj Estate Developers’ Lackluster Debut in Market

Suraj Estate Developers witnessed a feeble market debut today, showcasing a lower opening price compared to its issue price. The company’s shares were listed at ₹340 per share on NSE, marking a 5.55% decline from the issue price of ₹360. Similarly, on the BSE, the stock debuted at ₹343.80 apiece, representing a 4.5% discount.

IPO Details and Subscription:

The IPO of Suraj Estate Developers, open for subscription from December 18-20, was subscribed 16.57 times during this period. The retail category’s subscription was 9.85 times, while the Qualified Institutional Buyers (QIB) category’s subscription reached 25.74 times. Additionally, the Non-Institutional Investors’ (NII) portion was subscribed 20.02 times.

The public issue comprised a fresh issue of 1.11 crore shares valued at ₹400 crore, with no offer for sale (OFS) segment in the offer. The net proceeds raised from the IPO will be directed towards repaying or prepaying the company’s and its subsidiaries’ outstanding borrowings, acquiring land or land development rights, and fulfilling general corporate purposes.

Business Profile and Operations:

Established in 1986, Suraj Estates Developers specializes in residential and commercial real estate development within South-Central Mumbai. Notably, the company relies entirely on third-party contractors for construction services, without any in-house construction provisions.

Market Outlook and Grey Market Premium (GMP):

The grey market premium (GMP) for Suraj Estate IPO remains unchanged at ₹15, implying a market readiness to pay a premium of ₹15 per share. Considering the upper end of the IPO price band and the current grey market premium, the anticipated listing price was projected at ₹375 apiece, indicating a 4.17% increase from the IPO price of ₹360.

The ‘grey market premium’ signifies investors’ willingness to pay above the issue price, providing an indicator of market sentiment and potential listing price trends.

VoM News Desk

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