Anand Rathi Wealth IPO: Grey market premium drops 80% ahead of listing

Anand Rathi Wealth's IPO, to raise Rs 660 crore, was subscribed 9.8 times, receiving bids for 8.3 crore shares as against the 84.8 lakh shares on offer.

The categories of non-institutional investors and retail investors were subscribed 25.4 times and 7.8 times respectively. The portion reserved for qualified institutional buyers (QIBs) was booked 2.5 times.

Under the IPO, Anand Rathi Wealth shares were available for bidding in the range of Rs 530-550.

On the first and second day of bidding, Anand Rathi's GMP was steady at Rs 125. The IPO saw a subscription of 1.6 times on the first day, and three times on the second day. The second day of the bidding process coincided with a market-wide sell-off, after which, Anand Rathi Wealth's GMP slid to Rs 100 over the weekend.

On Monday, which also saw a sell-off in the market,  the GMP declined further, to Rs 60.

Analysts say investors still seem to be cautious on IPOs despite a rebound in the market.

The weak stock market debuts of companies like Paytm and the tepid response to the Star Health's IPO also seems to have added to investors' worries. Expensively priced issues and foreign investors pulling back from the markets is also making investors nervous.

The grey market premium of an IPO-bound stock gives an early reflection of how investors are reading the company.

According to data from IPOWatch, the GMP of Anand Rathi IPO suggests the shares would list at Rs 25 above the upper end of the price range, i.e. Rs 575.