The Indian IPO market is heating up with 7 companies – including unicorns Lenskart and Groww – showing grey market premiums (GMP) signaling potential listing gains of 10-21%. But are these paper profits worth chasing? Here’s your data-driven guide.
Why These IPOs Are Making Noise
The grey market premium acts as a sentiment thermometer for upcoming listings. Current standouts:
- Lenskart (Eyewear Leader): 18-21% GMP
- Groww (Fintech Disruptor): 15-18% GMP
- 5 Other Rising Stars: Spanning tech, healthcare, and FMCG sectors (10-15% GMP)
This reflects renewed confidence in India’s growth story despite global headwinds.
3 Reasons Behind the IPO Hype
- Category Leadership:
- Lenskart commands 50%+ eyewear market share
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Groww added 2M users in 2023 alone
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Market Tailwinds:
- Post-election stability boosting investor confidence
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Strong domestic liquidity supporting valuations
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Recent Success Stories:
IPOs like Tata Tech (+180% listing) have set high expectations.
Hidden Risks You Can’t Ignore
GMPs aren’t crystal balls – remember these cautionary tales:
⚠️ Valuation Concerns: Some companies trade at 20x revenue in grey market vs. 10x industry average
⚠️ Liquidity Crunch Risk: Fed rate decisions could trigger pullbacks
⚠️ Anchor Investor Exodus: 30% of IPO shares typically unlock after 30 days
Smart Investor Checklist
Before applying:
✅ Compare GMP vs. Fundamentals – Is growth justifying the premium?
✅ Study Lock-in Periods – When do large holders exit?
✅ Allocate Wisely – Never bet >10% portfolio on IPO bets
Expert Verdict
“High GMPs reflect optimism but require scrutiny,” says market analyst Ritesh Kumar. “Lenskart’s asset-light model and Groww’s monetization potential stand out, but avoid FOMO-driven decisions.”
