Why did Lodha developers IPO Grey market premium falling? By Yash Gupta, Angel Broking
Below are Views On Why did Lodha developers IPO Grey market premium falling? By Mr. Yash Gupta Equity Research Associate, Angel Broking Ltd
Macrotech Developers Limited (Lodha developers) to open IPO market on 7th April 2021, with IPO size of 2500 Crores and price band of 483-486.
As per the different market source, Grey market premium has fallen down to less than 3%, we also expect listing gain will be very limited in this IPO, retail investors should not expect any such big listing gains as we have seen in the past.
We also have some investment concerns for the IPO, company having a net debt of 16700 crores as on 31st December 2020, any downturn in industry may affect the company significantly. Company product portfolio is too concentrated on the residential market of MMR region any change in rule and regulation by authority may affect the company significantly. Company not been able to generate significant positive cash flow for the shareholder in the last 3 years and may continue to have negative cash flows in the near future.
We have given a Neutral rating for this IPO.
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