Campus Activewear IPO (Initial Public Offering) opened for subscription on Tuesday and after the first day of the offering, the public issuance is worth $Rs 1,400 crore has been subscribed 1.24 times while its retail part has been subscribed 1.88 times. Taking a cue from the strong response to the public offering, the gray market has become even more bullish with the IPO of Campus Activewear. According to market watchers, Campus Activewear’s share price is trading at a premium of $100 on the gray market today.
Campus Activewear OPI GMP
Market observers said that Campus Activewear IPO GMP (grey market premium) today is $100, which is $28 more than Tuesday’s gray market premium $72. They said that such an increase in Campus Activewear IPO GMP today can be attributed to the strong response to the public issue and the trend change in the secondary market. They said a lot will depend on market sentiment, as more bullish momentum may further boost gray market sentiment and bring in some more money in the IPO.
What does this Campus Activewear GMP IPO mean
According to market observers, Campus Activewear IPO GMP today is $100, that means the gray market expects Campus Activewear to go public around $392 ( $292 + $100), which is about 35 percent higher than Campus Activewear’s IPO price band of $278 to $292.
However, stock market experts said the gray market premium is an unofficial figure that has nothing to do with the company’s finances. One should decide to invest in an IPO after reviewing the balance sheet of the company because it provides concrete fundamentals of the company.
Campus Activewear IPO: To Buy or Not?
Giving the ‘buy’ label to Campus Activewear’s IPO, Anand Rathi’s research report says: “We view operations in a fast-growing segment, high and growing market share and strong financials as a positive. “, adding: “Revenue grew ~23% in FY20 EBITDA and PAT margins ranged respectively from ~17% to 18% and ~7% to 9% during FY19-20. 9M FY22 revenue was at $8.4bn and the EBITDA margin was 19.4%. The RoE/RoCE was 21.9%/22.7%. Net debt for fiscal year 21 was $1,000 million”.
Disclaimer: The opinions and recommendations made above are those of individual analysts or brokerage firms, and not of the Mint.