Sotefin Bharat IPO's grey market premium (GMP) has dropped sharply ahead of its expected listing, signalling muted listing gains despite the issue receiving healthy investor demand.
According to the Investor Gain, the latest GMP stood at Rs 3 on July 20, down nearly 75% from Rs 13 a day earlier and almost 89% from the recent high of Rs 27 recorded over the past eight trading sessions.
Based on the current GMP and the upper price band of Rs 187 per share, the estimated listing price is around Rs 190, indicating a potential listing gain of just 1.6%.
However, investors should note that the grey market is unofficial and GMP is only an indicator, not a guarantee of listing performance.
IPO subscribed 3.78 times on the final day
Despite the sharp fall in GMP, Sotefin Bharat's Rs 89.76 crore SME IPO received a decent response from investors, getting subscribed 3.78 times on the final day of bidding.
The company received bids for 1.29 crore equity shares against the 34.32 lakh shares on offer through more than 6,000 applications.
Non-institutional investors (NIIs) led the demand, subscribing to their reserved quota 4.74 times. The retail investor portion was subscribed 3.78 times, while the qualified institutional buyers (QIBs) category was booked 2.82 times.
The IPO closed for subscription on July 20 after opening on July 17.
Also Read: Sotefin Bharat Plans Rs 80 Crore IPO To Build Parking Robot Unit
Allotment and listing timeline
The company is expected to finalise the basis of allotment on July 21, while the shares are scheduled to list on the NSE SME platform on July 23.
Ahead of the IPO, Sotefin Bharat raised Rs 25.58 crore from 15 anchor investors by allotting 13.68 lakh shares.
IPO details
The company raised Rs 89.76 crore through a fresh issue of 48 lakh equity shares. There was no offer-for-sale component.
The IPO was priced in the range of Rs 178-187 per share.
How will the funds be used?
Sotefin Bharat plans to use Rs 20.1 crore from the net proceeds to set up a new manufacturing facility in Kolkata. The facility will manufacture robots used in automated parking systems, which are currently imported.
The company has also earmarked Rs 8.17 crore for capital expenditure towards new office premises and Rs 40 crore for working capital requirements. The remaining funds will be used for general corporate purposes.
About the company
Kolkata-based Sotefin Bharat provides mechanised and automated parking solutions with technology support from Switzerland-based Sotefin SA.
Its proposed manufacturing expansion represents a move towards vertical integration by enabling in-house production of robotic systems used in automated parking solutions.
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