Shares of Sanathan Textiles are likely to be listed on December 27 with a double digit premium. The company’s IPO has received tremendous subscription. Despite the weakness in the equity market, there was good demand for the company’s IPO. This first public issue of the polyester and cotton yarn manufacturer company received 35.12 times subscription during December 19-23.
The company’s IPO received 35.12 times subscription during December 19-23 and received an overwhelming response from investors across all categories. Qualified Institutional Investors bought 75.62 times of their allotted quota, while non-institutional quota and retail investors bought shares following performance. Non-institutional quota and retail investors were subscribed 42.21 times and 8.93 times respectively.
Prashant Tapse, Senior VP Research and Research Analyst at Mehta Equities, believes that subscription demand was good due to the company’s valuations being reasonable. Keeping in mind the market sentiment and better demand related to subscription, he said that the company’s shares are likely to be listed at 25% or more compared to the issue price of Rs 321 per share. He said, ‘The forecast of better listing gains is right, as we believe that Sanatan is fully capable of meeting the growing global demand for yarn and textile products.’
Narendra Solanki, head of fundamental research-investment services at Anand Rathi Shares & Stock Brokers and Aakriti Mehrotra, research analyst at Stocksbox, also believe that the company’s listing will be at a 26% premium to the current gray market price. Sanatan Textiles is one of the few companies in its segment, which has presence in polyester, cotton and technical textile sectors.