On Wednesday, November 1, Blue Jet Healthcare, a pharmaceutical company based in Maharashtra, made its debut on Dalal Street. The stock debuted on the BSE at ₹359.9, up 4% over the issue price of ₹346. On the NSE, it listed at ₹380, a premium of 9.8%.

Experts were not overly enthusiastic about the offering because they anticipated a flat to somewhat positive debut for the shares given the low market sentiment and existing grey market premium (GMP).

When we last heard, Blue Jet Healthcare was asking up to ₹20 for a share, indicating a flat to marginally positive listing price compared to its IPO pricing.

IPO shares can be purchased and sold on the grey market, an unauthorised marketplace, up until the listing.

With a current GMP of ₹20, the company is listed as good. The expected listing price of Blue Jet Healthcare shares is ₹366 based on the IPO’s upper price band of ₹346. This represents a premium of around 5% to 6%. The issue received 7.95 subscriptions, according to Swastika Investmart Ltd.’s Head of Wealth, Shivani Nyati.

Is Blue Jet going to be listed as a flat?

As a result of the present GMP and the mood of the market, Nyati predicted that Blue Jet Healthcare will see a flat to positive listing.

Hem Securities’ Astha Jain anticipates Blue Jet to list at a 5-8% premium above the offering price. “We recommend booking partial and holding partial allotment for the long term as the company being a large manufacturer of contrast media intermediates in India has a presence in niche categories with high barriers to entry.”

Prashanth Tapse of Mehta Equities stated that despite having a specialised product line, the subscription demand was lower than what the Street had anticipated. This was mostly because of the quiet market. He added that since the matter was solely a secondary offer (OFS) and no money was entering the company as growth capital, investors were also worried.

The analyst recommended cautious investors to book profits on listing day, anticipating a flat listing of approximately a two to five percent premium.

At closing, the issue had roughly eight subscribers, mostly from institutional and non-institutional investors. With 13.72 subscriptions, the QIB category had the highest rate, followed by 13.52 subscriptions for the NII portion. With 2.22 bookings, the retail portion was the least.

There was no new issue component in the ₹840.27 crore issue; it was just an offer-for-sale. The issue had a fixed price range of ₹329-346 per share and was up for bid from October 25 to October 27.

Therefore, the selling shareholder will receive the whole proceeds of the OFS, less issuing fees. There will be no profits for the corporation.

The issue’s book-running lead managers were Kotak Investment Banking, ICICI Securities, and JP Morgan, with Link Intime India serving as the registrar.

Overview of the company

Blue Jet Healthcare’s overall revenue for the three months ending in June increased 24% year over year to 185 crore, while net profit increased 59% to 44.1 crore.

76% of the company’s revenue in the fiscal year 2021–2022 came from Europe, with the US (4.18%), India (17.14%), and a few other nations following.

Blue Jet Healthcare is a specialty pharmaceutical and healthcare ingredient firm that serves both multinational generic pharmaceutical corporations and innovator pharmaceutical companies by providing niche goods. Its business strategy is centred on teamwork, the creation of complicated chemistry categories, and their manufacturing.

The company operates in three product categories: contrast media intermediates, high-intensity sweeteners, pharma intermediates, and active pharmaceutical ingredients (APIs). It has developed a contract development and manufacturing organisation (CDMO) business model.