According to the dealers active in the grey markets, Paradeep Phosphates is commanding a premium of merely Rs 0.5 in the grey market, which is hinting towards at par listing for the fertilizer player.
Dealers tracking the unofficial market said that the company’s lower subscription status, beaten down sentiments and flop listings in the near future are hurting the prospects of the company.
Abhay Doshi, co-founder, unlisted Arena said, “The issue was at reasonable valuations with strong prospects but the jittered sentiments of the secondary markets are weighing on the sentiments.”
Amarjeet Maurya, AVP – Mid Caps, Angel One said that Paradeep Phosphates Ltd IPO is going to list on the exchange on Friday, May 27, after receiving a dull response from investors and oversubscribed around 1.75x times.
“The company is valued in lin with peers and likely to face headwinds in terms of cost pressures due to recent increase in raw material prices, we do not expect significant listing gain and remain ‘neutral’ on the issue,” he added.
Not many of the recently listed companies have performed well and rewarded the investors. Investors have turned cautious over the primary market after many flop debuts, he added.
The Rs 1,501.73 crore initial offering of Paradeep Phosphates was open for subscription between May 17-19 as the company sold its shares in the price range of Rs 39-42 apiece.
The issue was overall subscribed 1.75 times, with quota for QIB investors getting more than thrice subscription. Retail portion was booked 1.37 times, whereas the HNI portion fetched only 82 per cent bids.
Incorporated in 1981, Paradeep Phosphates is the second-largest private sector manufacturer of non-urea fertilizers and Di-Ammonium Phosphate(DAP) in terms of volume sales for the nine months ended December 31, 2021.
The non-urea fertilizers manufacturer is engaged in manufacturing, trading, distribution and sales of a variety of complex fertilizers, under the brand names Jai Kisaan-Navratna and Navratna.
As of March 31, 2022, it distributed products across 14 states in India. The company’s network includes 4,761 dealers and over 67,150 retailers serving over five million farmers in India.