Going public is key for companies to raise funds from the market. Listing in the exchange offers a hoard of facilities to the firm, which is why IPO is an important decision for any corporate. An active IPO market is also indicative of a healthy financial market. It is good to see that the action is back in the IPO segment after a gap of four months due to lockdown. So far, more than ten companies have floated their initial public offers in this year, and there are more in the queue. In a recent announcement, GM Polyplast has announced its plans to launch IPO offers on September 28.
GM Polyplast IPO will launch in the small and medium enterprise (SME) segment for an IPO size of Rs 8.09 crores. The company will release 5.06 lakh shares in the market, consisting of fresh scrips and offer for sale shares.
GM Polyplast is involved in manufacturing various types of sheets and raw materials used in a wide variety of industries. Innovative product range, dedicated manufacturing units, and a nationwide footprint are some of the key factors which give the company a margin in the market.
GM Polyplast will be the third SME company to go public this month. If you want to subscribe to GM Polyplast IPOs, find the most important updates regarding the offer below.
- Important GM Polyplast IPOdates to note are opening date September 28 and closing October 6, 2020, tentatively
- It is a fixed price issue, and GM Polyplast IPOwill launch in the price band of Rs 160 per scrip
- The offer contains a fresh issue of 3.2 lakh equity shares and an offer for sale from promoters, Dinesh Balbirsingh Sharma and Ms. Sarita Dinesh Sharma of 1.86 lakh shares
- The offer also includes 26,000 shares reserved for market makers, constituting 26.35 percent of post-offer paid-up capital
- One can bid for a minimum quantity of 800 shares and multiples of 800 thereafter
- GM Polyplast IPOwill list in the SME segment of the Bombay Stock Exchange
- Gretex Corporate Services is appointed the lead book manager of the offer
The company is looking to raise funds to meet working capital requirements and general corporate purposes. According to company financials, it registered a profit of Rs 231.80 crores in March 2020.
Are IPOs A Good Investment Option?
As an investment choice, IPOs have both merits and demerits. Some investors are sceptical of investing in IPOs, mostly because they can’t gauge the future performance of the stocks, since those have no historical data. The famous example is the legendary Warren Buffet, who has always refrained from investing in IPOs. But on the other hand, IPO lets you exploit early market benefits. You can buy stocks of a potentially big company in the primary market before the stock prices start to gain momentum in the secondary market.
Should you invest in IPOs? It depends a lot on your investor persona, especially if you are a beginner investor. Here are a couple of things to evaluate to understand if IPO is the kind of investment for you.
Understand your pulse: Are you a natural risk taker? Be mindful that investing in IPOs involve risk, just like investing in general stocks. You would need to analyse your decision before investing. Are you aware of the sector the company is working in? Have you studied its performance and confident about its growth? There is no guarantee that IPOs will fetch higher returns. IPO performance is rather highly unpredictable. So, the risk factor is usually more.
A big name doesn’t always promise a return: We tend to trust big names more. But in the IPO market, don’t get tempted by the big names backed IPOs. Offers promoted by big investment banks or leading broking houses may not always be the best option for a retail investor like you.
IPO performance is related to the market trend: General market performance, as well as sectoral performance, has an impact on IPO. IPOs, which are fundamentally strong, do well in a bullish market. If you are lucky enough to select a great IPO offer, it will fetch you attractive returns within a short time.
If you like to subscribe to GM Polyplast IPOs, you can use UPI or ASBA as a preferred payment mode.