Gopal Snacks IPO: The experts predicting a poor debut for Gopal Snacks on March 14 warned that the listing may be affected by a quiet secondary market and ongoing selling in mid-and small-cap stocks.
“The soft listing seemed to be acceptable because the offer was entirely for sale and no money would be brought into the company for growth. We believe that this offering will allow investors to accumulate the growth story over time,” said Prashanth Tapse of Mehta Equities.
According to Amit Goel of Pace 360, Gopals’ fundamentals are weak due to their reliance on a small collection of products and locations.
It has a strong presence in Gujarat but lacks strength in other places. It competes fiercely in a fragmented market with tight margins, according to the analyst.
StoxBox’s Parth Shah stated that the company used its experience and understanding of customer and target market preferences to build a diverse range of products, allowing it to strengthen its position in the Indian snacks industry. But he, too, anticipates a mediocre debut, “without fetching any premium over its subscription price”.
The offering, a pure offer for sale, was subscribed 9.02 times, with investors purchasing 10.81 crore equity shares against an offer size of 1.19 crore.
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Qualified institutional purchasers led the way in supporting the public offering, purchasing 17.50 times their permitted quota of shares, followed by non-institutional investors, who purchased 9.5 times their allotted allotment.
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