Paras Defence IPO GMP: Paras Defence and Space Technologies initial public offering (IPO) opened for subscription yesterday and it will remain open for bidding till 23rd September 2021. The public issue got subscribed 16.57 times after first day of bidding — reflecting positive sentiment of investors towards the initial public offer. Meanwhile grey market has also gone bullish over the defence company's public offer. According to market observers, Paras Defence IPO grey market premium (GMP) today is Rs235 — Rs25 up from its Tuesday GMP of Rs210.

Market observers said that small issue size, reasonable valuations and Government of India's focus on defense sector may continue to generate huge fancy towards the IPO and rising premium of Paras Defence shares in grey market reflects the same. They said that rising grey market premium of Paras Defence IPO indicates that it may have strong listing at Indian bourses.

Market observers said that Paras Defence IPO GMP today is Rs235 — Rs25 higher from its yesterday's GMP of Rs210. They said that Paras Defence IPO GMP has shot up from Rs150 to Rs235 in just one week. In fact, Paras Defence IPO grey market price has surged from Rs180 to Rs235 in just 3 days. Observers maintained that such a robust premium in the grey market reflects strong listing of the public issue and it may reflect in the Paras Defence IPO subscription status in next two days bidding.

What this Paras Defence IPO GMP mean

Market observers said that grey market premium is an unofficial listing gain expected by the grey market. As Paras Defence IPO GMP today is Rs235 against its issue price of Rs165 to Rs175 per equity share, this means grey market is expecting Paras Defence IPO listing at around Rs410 ( Rs175 Rs235) — around 135 per cent higher from its upper price band.

Speaking on Paras Defence IPO; Saurabh Joshi, Research Analyst at Marwadi Shares and Finance Limited said, "Considering the FY-21 adjusted EPS of Rs4.05 on the post-issue basis, the company is going to list at a P/E of 43.23 with a market cap of Rs6,825 mn. There are no listed entities in India whose business portfolio is comparable with that of the company’s business. We assign a subscribe rating to this IPO as the company offer a wide range of products and solutions for both defense and space applications and is well-positioned to benefit from the Government’s “Atmanirbhar Bharat" and “Make in India" initiatives."

Abhay Doshi, Founder at UnlistedArena.com said, "Small issue size, reasonable valuations and Government of India's focus on defense sector may generate huge fancy in IPO." He went on to add that higher budgetary allocation for defense sector, liberal policies and PLI scheme for drones is expected benefit such companies.