This Rs 45 crore IPO garnered Rs 7,000 crore demand! GMP zooms over 4x before listing

When the Indian stock markets are struggling to hold the ground and mainboard IPOs are struggling to get strong bidding interest from investors, an SME issue has managed to get bids for more than 155 times the actual amount raised from the investors. The grey market premium for the stock has jumped more than 4 times ahead of its market debut.

We are talking about the SME issue of Recode Studios, which also featured in the second season of entrepreneurship-based  popular reality show, but failed to secure any funding from the 'sharks' for their pitch. However, the company is now set for its stock market debut, thanks to stellar interest from the investors.

Ludhiana-based Recode Studio sold its shares for Rs 150-158 apeice with a lot size of 800 equity shares between May 5 to May 7. The company eyed to raise Rs 45 crore from its maiden share sale which included a fresh share sale of Rs 5 crore and a fresh issue of up to 26.77 lakh equity shares worth Rs 42 crore. It raised Rs 12.67 from five anchor investors.

Interestingly, the issue net of anchor book was booked an astounding 160.62 times, fetching nearly 1.57 lakh applications worth Rs 6,800 crore. NIIs portion was booked more than 396 times, while retail quota saw more than 214 times bids. Investors made bids for more than 43 crore equity shares but only 828 investors got the allotment of the issue.

Ahead of its listing, shares of Recode Studio were commanding a grey market premium (GMP) of Rs 48-50, suggesting a 30-32 per cent listing pop for the investors. However, its grey market premium stood at Rs 11-12 when the issue was announced. It means that the GMP has zoomed over 4 times during its IPO journey.

Incorporated in 2021, Ludhiana-based Recode Studio is an Indian beauty and personal care company operating under the 'Recode' brand. Its business focuses on branding, sourcing and selling beauty and personal care products across India. Its product range includes make-up, skincare, body care, and beauty accessories.

Seren Capital is the sole book running lead manager and Mudra RTA Ventures served as the registrar of the issue. Asnani Stock Broker served as the market maker of the company. Shares of the company shall be listed on BSE SME platform on Tuesday, May 12. As of the IPO price, the company commands a current market capitalization of Rs 168 crore.