This article delves into two mainboard Initial Public Offerings (IPOs) that are opening concurrently. We will examine their Grey Market Premiums (GMPs), with one trading significantly higher than the other. Our goal is to analyze their percentage-wise GMP and determine which IPO is anticipated to receive a more favorable response.
Lakshmi India Finance IPO: Key Details
The Lakshmi India Finance IPO is set to open from tomorrow, with application opportunities on July 29th, July 13th, and July 31st.
- Face Value: ₹5 per share.
- Cut-off Price: ₹158.
- Minimum Lot Size: 94 equity shares.
- Issue Size: ₹254 crore. This comprises a Fresh Issue of ₹165 crore (funds directly for the company) and an Offer For Sale (OFS) of ₹89 crore (funds for promoters and existing shareholders).
- Listing: The company will be listed on both BSE and NSE.
Aditya Infote IPO: Key Details
The Aditya Infote IPO is also scheduled to open tomorrow.
- Face Value: ₹1 per share, suggesting higher liquidity compared to Lakshmi India Finance.
- Upper Price Band: ₹675.
- Issue Size: ₹1300 crore, making it a significantly larger IPO. This includes a Fresh Issue of ₹500 crore and an Offer For Sale (OFS) of ₹800 crore.
- Listing: It will also list on both BSE and NSE.
- Employee Discount: Aditya Infote IPO offers a discount of ₹26 for the employee category, setting the cut-off price at ₹615 for eligible employees.
Both IPOs are Book Building IPOs, requiring a minimum application amount of ₹15,000.
Comparative Analysis of Key IPO Features
When comparing the two, several differences become apparent:
- Liquidity: Aditya Infote, with a ₹1 face value, is expected to offer better liquidity than Lakshmi India Finance, which has a ₹5 face value.
- Issue Size: Aditya Infote’s issue size of ₹1300 crore is substantially larger than Lakshmi India Finance’s ₹254 crore.
- Retailer Allocation: Retail investors will find a higher chance of allotment in Lakshmi India Finance, with 35% of shares allocated to this category. In contrast, Aditya Infote has only 10% allocated to retailers, implying a lower chance of allotment.
- Employee Discount: Only Aditya Infote offers a discount for the employee category.
IPO Timelines
The tentative dates for both IPOs are as follows:
- Opening Date: Tomorrow (first application day for Lakshmi India Finance is July 29th).
- Anchor Investor List: Expected on July 28th. The strength of this list will be crucial for both IPOs.
- Allotment Status: Investors can expect to receive notification of allotment on August 1st.
- Listing Date: Both IPOs are expected to list on BSE and NSE on August 5th.
Financial Health and Valuation
Aditya Infote IPO:
- Profit After Tax (PAT): The company has shown consistent growth in profits after tax. From ₹108 crore in FY23, it rose to ₹115 crore in FY24, and further to ₹351 crore in FY25.
- Revenue: While there was a slight dip in revenue in FY24, the overall trend suggests strength.
- Market Cap: The company’s market capitalization is ₹7911 crore.
- Valuation: Its valuation appears attractive compared to its peers.
- Price-to-Earnings (P/E) Ratio: The P/E ratio stands at 21.
Lakshmi India Finance IPO:
- Profit After Tax (PAT): The company has also demonstrated consistent profit growth, with PAT figures of ₹16 crore in FY23, ₹22 crore in FY24, and ₹36 crore in FY25.
- Revenue: Consistent revenue growth has been observed.
- Market Cap: With a market capitalization of ₹825 crore, it is a smaller company compared to Aditya Infote.
- Valuation: Its valuation is considered less attractive when compared to its industry peers.
- Price-to-Earnings (P/E) Ratio: The P/E ratio is 18, which is perceived as slightly expensive for the finance sector.
Grey Market Premium (GMP) Analysis
Lakshmi India Finance IPO:
- Current GMP: The Grey Market Premium for Lakshmi India Finance IPO is ₹13, according to SH reports.
- Listing Gain Potential: This GMP does not suggest a particularly strong listing gain potential, indicating moderate demand in the grey market.
Aditya Infote IPO:
- Current GMP: Initially, Aditya Infote’s GMP was ₹225. However, it has seen a sudden jump and is now trading at ₹255.
- Listing Gain Potential: Based on a GMP of ₹225 on an issue price of ₹675, an approximate listing gain of 33% was expected. With the GMP now at ₹255, the projected listing price is around ₹930, implying a higher listing gain of approximately 38%, potentially yielding around ₹6000 per IPO application. This indicates very high demand in the grey market.
Conclusion and Recommendation
Considering all factors, the Aditya Infote IPO appears to be the first priority due to its attractive valuation, larger issue size, consistent profit growth, and significantly higher Grey Market Premium, which suggests strong listing gain potential.
For the Lakshmi India Finance IPO, it is advisable to observe the response on the first and second days of the application window before making a decision to apply.
