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What the gray market suggests before its debut


Tarsons Products is expected to list its shares on the stock exchange on Friday, November 26. Kolkata-based life science company Tarsons Products earned a premium on the gray market – an unofficial market for unlisted securities – before its secondary market debut on Dalal Street. Tarsons was commanding a Gray Market Premium (GMP) of around Rs 180 before debut, according to dealers.

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Aayush Agrawal, senior research analyst and investment bank at Swastika Investmart, expects Tarsons shares to rise around 20-25%.

“Tarsons Products has a strong financial position where the margins are very impressive and it also has well-experienced management. The company has strong cash flow and is likely to become debt-free after the IPO. valuations seem expensive, so aggressive investors with a long-term view can own this stock, ”he said.

Agrawal suggests to those who participate in the IPO for a listing gain to make profits on the listing day.

The Tarsons Products IPO received a laudable response from investors despite a higher price tag, said Abhay Doshi, co-founder of Unlisted Arena, a portal that tracks gray markets and deals in unlisted securities.

“Strong growth prospects and decent margins have made the issue attractive … The issue could go for around Rs 800-850, a gain of around 20%, which is reasonable,” a- he declared.

Tarsons Products’ initial public offering (IPO) – which was auctioned from November 15-17 – saw an aggregate subscription of 77.5 times, receiving bids for a total of 84 crore of shares against 1.1 crore of proposed actions.

The section reserved for qualified institutional buyers (QIBs) saw a subscription of 115.8 times the shares offered. The categories of non-institutional investors and retail investors registered subscriptions 184.6 times and 10.6 times respectively. The portion reserved for employees was counted 1.8 times.

(Edited by : Abhishek Jha)

First publication: STI


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