Orient Tech IPO fully booked on Day 1; GMP up 34% today; should you bid?

Orient Technologies IPO Day 2: The initial public offering (IPO) of Orient Technologies, which opened for public subscription yesterday, has received a positive response from investors, getting oversubscribed by 6.64 times at the end of the first day of subscription on August 21, 2024. The three-day subscription window to bid for the Orient Technologies IPO closes tomorrow, Friday, August 23, 2024. 

Investors can bid for a minimum of 72 shares and in multiples thereof. Accordingly, the minimum amount required by a retail investor to bid for the Orient Technologies IPO is Rs 14,832.

Orient Technologies IPO subscription status

The Orient Technologies IPO, available at a price band of Rs 195-206 per share and a lot size of 72 shares, received the highest bid from Retail Individual Investors (RIIs), with the highest subscription at 10.49  times. Non-Institutional Investors (NIIs) subscribed 6.17 times, while Qualified Institutional Buyers (QIBs) received 0.02 times subscription.

 

Orient Technologies IPO grey market premium (GMP)

Meanwhile, the unlisted shares of Orient Technologies continue to command a strong grey market premium (GMP) on the second day of subscription. According to several websites that track grey market activities, shares of Orient Technologies were trading at a premium of around Rs 70 or 34 per cent at the upper end of the issue price, indicating positive market sentiment for the public issue.

At the upper end, the company seeks to raise Rs 214.76 crore by offering a fresh issue of 5,825,243 shares worth nearly Rs 120 crore and an offer for sale of 4,600,000 shares with a face value of Rs 10 apiece. The allotment for Orient Technologies IPO shares is scheduled for Monday, August 26, 2024. Orient Technologies shares are expected to list on the BSE and NSE on Wednesday, August 28, 2024.

Should You Bid for the Orient Technologies IPO?

Shivani Nyati, Head of Wealth at Swastika Investmart, remains optimistic about the public issue of Orient Technologies. According to Nyati, the company's comprehensive IT solutions portfolio and consistent financial growth underscore its strong market position. However, reliance on key clients, technology partnerships, and government tenders, coupled with intense competition, presents potential challenges.

"The IPO is valued at a P/E multiple of 17.45x, which appears reasonable. After considering all factors, we recommend a subscribe rating for this IPO, but investors should adopt a cautious approach," said Nyati.

Meanwhile, analysts at Mastertrust have recommended that investors subscribe for the medium to long term. READ MORE