India’s fifth-largest paint maker Indigo Paints IPO lists at 75% premium over the issue price

• Sequoia Capital-backed Indigo Paints listed at ₹2607, which is at a 75% premium to the set price band at ₹1,488-1,490 per share.
• The company’s market value expanded to ₹12,188 crore after the listing.
• The ₹1,000 crore share sale concluded with the subscription of a little over 117 times the offer value on January 22.
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It was a blockbuster debut for the ₹1,000 crore initial public offering (IPO) of Sequoia Capital-backed Indigo Paints on the bourses today. The stock listed at ₹2607, which is at a 75% premium to the set price band at ₹1,488-1,490 per share.

Within minutes after listing, the shares of Indigo Paints lost nearly 3% of their value and were trading at ₹2521 apiece at 10:05 am in an otherwise robust market.

The company’s market value expanded to ₹12,188 crore after the listing.

The bumper listing was already on the cards!

The Indigo Paints IPO garnered a super response from investors at the time of subscription. The ₹1,000 crore share sale concluded with the subscription of a little over 117 times the offer value on January 22.

And, despite the grey market premium fizzling out a bit, the shares commanded a premium of ₹850-900 today. The grey market premium plunged nearly 10% last week after Birla Group-owned Grasim announced its foray into the paint business. The entry of a top billionaire like Birla was not a risk investors had factored in at the time of subscription.

The IPO was attractively priced, and nearly all brokerages firms had given it a ‘subscribe’ rating as the Pune-based paint maker emerged as a tight competition to much larger peers like Asian Paints and Berger Paints in recent years. Indigo Paints is a relatively small player with a 2% market share, but its profit has grown significantly, nearly four times in the last three years.

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