Ami Organics IPO: Here’s what GMP is signalling about listing

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Shares of Ami Organics are available at a premium of around Rs 150 in the grey market against the issue price of Rs 610. It indicates that shares of the company may list at a premium of over 20% on the BSE and NSE on September 14, Tuesday. Earlier, the initial public offer of specialty chemicals maker Ami Organics was subscribed 64.54 times on the closing day of subscription on September 3. The Rs 569.63 crore IPO received bids for 42,22,36,296 shares against 65,42,342 shares on offer, as per data available with the NSE.

Qualified Institutional Buyers (QIBs) category was subscribed 86.64 times, non-institutional investors 154.81 times and retail Individual Investors (RIIs) 13.36 times. The public offer had a fresh issue of up to Rs 200 crore and an offer for sale of up to 6,059,600 equity shares. Its price range was at Rs 603-610 per share.

“Ami Organics is available at a premium of Rs 157 in the grey market,” said Abhay Doshi, founder, Unlisted Arena.

Yash Gupta, equity research analyst, Angel Broking said, “Ami Organics’ basis of allotment for retail shareholders is 17:161 allotment, it means that only nearby 10% of retail investors will get the allotment. Ami Organics IPO was priced at price to earnings of 35.6 times and EV/EBITDA of 25.7 times at the upper price band of the IPO based on FY2021 numbers. Which is on the higher side, compared to the listed peer group. The current grey market premium is at RS 145 which means 23% at the upper price band of the IPO. We suggest short-term investors book profit on listing day if they receive the allotment.”

The company is one of the leading R&D driven manufacturers of specialty chemicals with varied end usage, focussed towards the development and manufacturing of pharma intermediates for regulated and generic APIs (active pharmaceutical ingredients) and NCE (new chemical entity) and key starting material for agrochemicals and fine chemicals.

This was the company’s second attempt to go public. Earlier, Ami Organics had filed preliminary papers with Sebi in 2018 and had received the regulator’s nod to launch the public issue. However, it did not float the IPO. Intensive Fiscal Services, Ambit Private Limited and Axis Capital were the managers to the offer.