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Below is quote on Vijaya Diagnostics Weak response on Day 1 and GMP by Mr. Yash Gupta, Equity Research Associate, Angel Broking Ltd 

Vijaya Diagnostic received a weak response from investors on 1^st day of the IPO and GMP comes down to ₹15.

Vijaya Diagnostic Centre Limited IPO opens on 1^st September 2021 with an IPO price band of ₹522-₹531 and IPO issue size of ₹1894 crores at the upper price band. On the first day of the subscription Vijaya Diagnostic IPO got a weak response from investors, Qualified Institutional investor portion got a subscription of 23% and the Retail investors portion got the subscription of 46% overall IPO got a subscription of 30% by the end of the first day. If we look at the Grey Market Premium momentum for Vijaya Diagnostic IPO, as per the different market news currently GMP trading at ₹15 which comes down from ₹40 last week.

Based on FY2021 numbers, IPO is priced at a Price to Earnings of 64.3 times and EV/EBITDA of 30 times at the upper price band of the IPO, which is in line with the listed peer group. The company already has a higher market share in key geographi like Hyderabad and we do not expect the covid related benefit to continue in coming years. We believe that at ₹531, all the near-term positives are priced in and leaves limited upside for the investors. Hence, we had assigned a “NEUTRAL” recommendation to the Vijaya Diagnostic centre limited IPO.

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