Aditya Birla AMC IPO: The issue of the company is opening for subscription on September 29. This IPO will close on October 1.
The promoters of the company are preparing to raise Rs 2786.26 crore through offer for (OFS) sale. Meanwhile, trading of unlisted shares of Aditya Birla Sun Life AMC has started in the gray market.
The price band of the company's IPO is Rs 695-712 per share. The issue is trading at a premium of Rs 70 in the gray market. According to market experts, the gray market premium of Aditya Birla Sun Life AMC is Rs 70 today.
This is Rs 10 more than on September 26. Last week it was trading at a premium of Rs 30 in the gray market. But on September 27, two days before the opening of the issue, it has reached Rs 70.
In the last one week, the premium of Aditya Birla Sun Life AMC has increased from Rs 40 to Rs 70. However, market experts say that its GMP depends on how the issue is subscribed. This is 100% offer for sale, due to which the subscription may get affected.
What is the meaning of GMP?
The premium that a company's unlisted shares are doing in the gray market gives an idea of how much investors are liking it.
Today the gray market premium of Aditya Birla Sun Life AMC is Rs 70. Accordingly, its unlisted shares are trading at Rs 782 (712+70).
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However, market experts are repeatedly warning that the criteria for bidding for IPO should not be GMP at all.
Before investing money in the IPO of a company, one should see the balance sheet of that company and then make an investment decision.
What should investors do?
According to Mint, about the fundamentals of Aditya Birla Sun Life AMC, Abhay Doshi, Founder, UnlistedArena.com, said, "Aditya Birla Group's mutual fund company is among the 4 mutual fund companies in the country in terms of QAAUM (Quarterly Average Asset Under Management).
As of June 30, 2021, it had managed assets of Rs 2936.42 billion. Doshi said that the growth of the AUM industry has increased due to increased financial awareness among investors.
Aditya Birla Sun Life AMC's focus so far has been on debt funds which have lower margins than equity schemes. But now it seems that the company is increasing its focus on high-margin products.
Doshi further said that according to the upper price band of Rs 712, its pricing is same as that of the rival companies.
The company's P/E is 39 as of Fiscal Year 2021, due to which there is less opportunity for short term investors. It can be invested in for long term. But many options of this company are present in the market.