One97 Communications, PaytmThe parent company of the company, is likely to have a muted debut on the stock exchanges of India tomorrow, following the trend set by startups like
zomato,
hero And
Policybazaar India, which all had stellar listings.

Shares of Paytm parent firm on Wednesday, a day before listing One97 Communications but exchanged hands at a premium of only Rs 20-25 on the final issue price of Rs 2,150 Grey Market, On Tuesday, they were trading at a premium of only Rs 30, an increase of only 1.4% from the final issue price,
According to IPO Watch,

The stock was trading at Rs 2,300 per share in the gray market on November 7, which was Rs 150 or 7% higher than the issue price. It fell to Rs 80 on the first day of IPO And till the issue ended on November 10, it was at Rs 40.

gray market premium (GMP) is a term used in the IPO market and refers to the estimated price at which a stock may list. The gray market is informal but investors use the GMP as an indicator of how a stock may perform upon listing. The GMP, while a useful indicator, is by no means infallible. Sometimes it accurately predicts the listing price and sometimes it doesn’t.

flat listing required

Dealers tracking the gray market said exorbitant pricing, poor financials and weak growth prospects are the main reasons for poor listings.

Unlisted Arena co-founder Abhay Doshi said Paytm is likely to flop on its debut despite being promoted as India’s biggest IPO ever. “The valuation of the issue was costly. Also, the company has not shown any significant performance in financial performance and is losing market share,” he added.

Ankur Saraswat, Research Analyst, Trustline Securities, said the company will do flat listing. “New investors should wait for a meaningful correction in the stocks and then enter this fintech giant,” he added.

Paytm’s lukewarm IPO

In its IPO held between November 8 and 10,
Paytm raises Rs 8,300 crore by issuing fresh shares, while the existing shareholders and promoters sold shares worth Rs 10,000 crore in the offer-for-sale component.

The IPO was subscribed just 18% on the first day of bidding, with the company receiving bids for 88.21 lakh out of 4.83 crore equity shares on offer. On the second day, with 2.34 crore bids, it was subscribed 48%. India’s biggest IPO was fully subscribed on day 3 and was eventually subscribed 1.89 times.