Summary
The Indian primary market is buzzing once again, and grey market premiums of upcoming IPOs are flashing promising signals for investors seeking listing gains. After months of subdued activity, the surge in GMPs is igniting hopes of lucrative returns from new listings. However, while the grey market hints at robust gains, experts warn that caution is crucial to avoid hype-driven risks. Let’s explore what’s fueling this surge and what investors should keep in mind.
Grey Market Heats Up with Soaring IPO Premiums
After a quiet first half of 2025, investor appetite has returned with a bang. Grey market premiums (GMPs) — the unofficial price at which IPO shares trade before listing — have climbed sharply across both mainboard and SME issues.
For instance, Urban Company’s IPO, which saw a massive 103x subscription, is commanding a GMP nearly 55% higher than its issue price of ₹103 per share. Likewise, Srinagar House of Mangalsutra is witnessing a GMP around 19% above its issue price of ₹165, while Dev Accelerator is trading nearly 14% higher than its issue price of ₹61.
Such strong grey market activity clearly reflects renewed investor confidence, fueled by positive market sentiment and strong demand from both retail and institutional buyers.
Upcoming IPOs Drawing Strong Grey Market Buzz
Among the upcoming IPOs, VMS TMT, opening on September 17, is already quoting a 20% GMP above its issue price of ₹99 per share. Other new issues such as Ivalue Infosolutions (opening September 18) and Euro Pratik Sales (opening September 16) are expected to join the trend soon as they enter the grey market radar.
Analysts attribute this shift to a robust secondary market, smaller issue sizes, and compelling sectoral narratives in green energy, infrastructure, and technology, which have created a classic supply-demand imbalance — driving GMPs higher.
SME IPOs Riding High on Grey Market Momentum
The SME segment IPOs are witnessing even stronger traction. Airfloa Rail Technology, set to list on September 18, has seen its GMP skyrocket by 119% over the issue price of ₹140. LT Elevator, listing on September 19, is quoting a 28% premium over its issue price of ₹78.
Meanwhile, TechD Cybersecurity, which opened on September 15, is already up 83% in the grey market over its issue price of ₹193. Others like Sampat Aluminium and JD Cables are showing premiums of over 15%, while Karbonsteel Engineering (15%), Taurian MPS (9%), and Jay Ambe Supermarkets (11%) are also riding the wave of optimism.
What’s Powering the Surge in GMPs?
According to experts, high liquidity, stable interest rates, low inflation, and strong equity market performance are encouraging investors to seek short-term opportunities in upcoming IPOs. With surplus cash chasing limited offerings, the grey market is reflecting aggressive bidding and a strong appetite for new listings.
Prashant Tapse of Mehta Equities explains, “With equity markets stable and investor confidence high, surplus liquidity is flowing into IPOs, making them attractive short-term bets.”
Don’t Chase the Hype — Stay Cautious
While soaring GMPs are tempting, experts warn against relying solely on GMP as an investment metric. The grey market is unregulated and highly speculative, and GMPs can be manipulated or inflated by artificial demand. Several IPOs with strong GMPs in the past have listed below expectations or turned negative soon after listing.
Therefore, investors should focus on company fundamentals, valuations, sectoral outlook, and business sustainability rather than just GMP trends before applying for IPOs.
Bottom Line
The rising grey market premiums of upcoming IPOs reflect a revived primary market and strong investor sentiment, promising potentially rewarding listing gains. However, prudence, research, and disciplined investing are key to navigating this hype-driven environment. For investors, this is a time to stay optimistic yet cautious — and make informed decisions to capture opportunities while avoiding unnecessary risks.
Note: All information and images used in this content are sourced from Google. They are used here for informational and illustrative purposes only.
Frequently Asked Questions on Grey Market Premiums of Upcoming IPOs
Q1. What is a Grey Market Premium (GMP) in IPOs?
A Grey Market Premium (GMP) is the price at which IPO shares are traded unofficially before their official listing on the stock exchange. It reflects the extra amount buyers are willing to pay over the issue price based on demand and listing expectations.
Q2. Why are GMPs of upcoming IPOs rising recently?
GMPs are rising due to strong investor appetite, improved market sentiment, and high liquidity. A robust secondary market, stable interest rates, and lower inflation have also encouraged more retail and institutional investors to bid aggressively for IPOs.
Q3. Which recent IPOs are showing strong grey market premiums?
Recent IPOs such as Urban Company, Srinagar House of Mangalsutra, and Dev Accelerator have seen strong GMPs. Urban Company is trading at about 55 percent above its issue price, while Srinagar House of Mangalsutra and Dev Accelerator are 19 percent and 14 percent above their issue prices, respectively.
Q4. Are upcoming IPOs also expected to deliver strong listing gains?
Yes, some upcoming IPOs are already showing strong grey market activity. For example, VMS TMT is witnessing a GMP of nearly 20 percent over its issue price. Others like Ivalue Infosolutions and Euro Pratik Sales are yet to reflect in the grey market but are expected to attract interest.
Q5. What is happening in the SME IPO segment?
The SME segment is showing strong momentum. Airfloa Rail Technology is trading 119 percent above its issue price in the grey market, LT Elevator is up 28 percent, and TechD Cybersecurity has jumped 83 percent. Several others like Sampat Aluminium, JD Cables, Karbonsteel Engineering, Taurian MPS, and Jay Ambe Supermarkets are also trading above their price bands.
Q6. What factors are driving the surge in GMPs?
High investor liquidity, smaller issue sizes creating demand-supply imbalances, strong sectoral narratives in technology, green energy, and infrastructure, along with positive stock market performance, are driving the surge in GMPs.
Q7. Can investors rely on GMP as the only indicator for IPO investments?
No, relying solely on GMP is risky. GMP is part of an unregulated and speculative grey market, which can be manipulated by artificial demand or hype. It does not always reflect a company’s real fundamentals or guarantee strong listing performance.
Q8. What precautions should investors take while applying for IPOs with high GMPs?
Investors should research the company’s financial health, business model, industry outlook, and valuation rather than making decisions based only on GMP. It is important to invest cautiously, especially in highly oversubscribed or hyped IPOs.