Antony Waste Handling grey market premium falls amid share market volatility; what to expect on listing day?

The Rs 300-crore Antony Waste Handling Cell’s initial public offer (IPO) has been subscribed 2.7 times so far on day two with retail investors subscribing their portion nearly 5 times. The solid waste management company had earlier launched its IPO in March this year but was withdrawn due to a weak response from investors. After the new strains of the coronavirus reported in the UK, Indian share markets reversed the gains made in the last couple of sessions. In today’s session, BSE Sensex and Nifty 50 were seen trading volatile, which hit Antony Waste Handling Cell’s grey market premium.

So far, Qualified Institutional Buyers (QIBs) have subscribed to 63 per cent of their quota while Non-Institutional Investors (NIIs) have bid for merely 15 per cent of the portion reserved. Not less than 50 per cent of the issue has been reserved for QIBs while 35 per cent for retail investors and up to 15 per cent for the NIIs.

Grey market premium hit by share market correction

The grey market premium of Antony Waste has fallen to Rs 60 from Rs 190 previously. Antony Waste Handling Cell shares were seen trading at Rs 375 apiece, up Rs 60 or 19 per cent, over the issue price of Rs 315 apiece. In the previous session, the shares of the solid waste management company were seen trading with Rs 190 or 60 per cent premium over the IPO price, at Rs 505 apiece. Abhay Doshi, Founder- UnlistedArena.com dealing in Pre-IPO & Unlisted Shares, told Financial Express Online, that the grey market premium of Antony Waste subsequently jolted with the fall in the broader market. The premium fell more than 50 per cent in a day.

Abhay Doshi also added that a significant euphoria was seen in the primary market owing to bull run in broader markets. Antony Waste IPO which was called off in March 2020, was getting Rs 180 premium over issue price which was quite surprising. “No sooner the market corrected, grey market premiums too fell in a parallel fashion,” Doshi said.

Manthan Mehta, Head Unlisted & Private Equity Rurash Financial Services Pvt Ltd, told Financial Express Online, that the grey market premium of Antony Waste fell today following the correction in Indian share market yesterday. Mehta expects Antony Waste Handling Cell shares to list at Rs 410, implying a 35 per cent premium over the IPO price.

What to expect from Antony Waste Handling Cell on listing day?

Antony Waste Handling Cell ltd (AWHC) is one of the top players in the waste management system in India. The management is highly dependent on the municipal authorities for a substantial proportion of its business and revenues. Vishal Wagh, Head of Research, Bonanza Portfolio Ltd told Financial Express Online that any decline in budgetary allocations towards Municipal Solid Waste Management services may have a material adverse impact on the business. Also, the company has a receivable risk from municipalities. “The issue is offered at P/E of 11.5x on FY20 earnings. We assign a Neutral rating to the issue,” Wagh said.