Nova Agritech had an impressive debut on January 31, as its shares made a strong opening at Rs 55 on the NSE and Rs 56 on the BSE, reflecting a substantial 36.5 percent premium over the IPO price of Rs 41. Analysts, who had anticipated a listing with a 40-70 percent premium ranging from Rs 58 to 72, closely observed the company’s initial market performance.
Before the listing, Nova Agritech shares were already trading at a 30 percent premium in the grey market, an unofficial platform where shares trade prior to IPO allotment and continue until the listing day. The grey market premium (GMP) serves as an indicator for potential investors to gauge the expected listing price.
The IPO garnered significant investor interest, with a robust subscription of 109.37 times. High net-worth individuals (HNIs) led the way, subscribing 227.19 times the allotted quota. Retail investors also demonstrated strong participation, subscribing 77.12 times their allocated portion, while qualified institutional buyers showed substantial interest, with a subscription of 79.31 times.
Nova Agritech’s IPO, open for subscription from January 23 to January 25, included a fresh issue of 2.73 crore shares worth Rs 112 crore and an offer-for-sale of 77.58 lakh shares worth Rs 31.81 crore. The price band for the offer was set at Rs 39-41 per share.
The company plans to allocate the IPO proceeds strategically, with Rs 14.20 crore earmarked for investment in subsidiary Nova Agri Sciences to establish a formulation plant, Rs 10.49 crore for funding capital expenditure and expanding the existing plant, Rs 26.65 crore for working capital requirements, and Rs 43.36 crore for investment in Nova Agri Sciences.
Nova Agritech is backed by promoters Suraksha Agri Retails (India), Malathi S, and Kiran Kumar Atukuri. Keynote Financial Services and Bajaj Capital served as the book-running lead managers for the IPO, while Bigshare Services assumed the role of registrar.
