Shares of agricultural biotechnology firm Unisem Agritech Ltd witnessed a subdued and disappointing start to their trading journey on the stock exchanges on Wednesday, December 17. The stock, which debuted at its issue price, quickly came under selling pressure, erasing investor gains on the very first day.
A Disappointing Market Debut
The Unisem Agritech IPO was listed at ₹65 per share, exactly matching its initial public offering price. However, the optimism was short-lived. The stock price immediately faced a downward trend, plunging to hit an intraday low of ₹62. This represented a significant decline of 4.62% from both its IPO and listing price, leaving retail investors in the red.
This lackluster performance was anticipated by market observers, as indicated by the grey market premium (GMP) activity in the days leading up to the listing. The Unisem Agritech IPO GMP was ₹0 on the listing day, signaling that the shares were expected to list without any premium or discount, which is precisely what transpired.
IPO Subscription and Key Details
The public offering, which was entirely a fresh issue of equity shares, managed to garner a moderate response from investors. The ₹21.45 crore SME IPO was subscribed 2.03 times overall by the close of the bidding process. A closer look at the category-wise subscription reveals that the portion reserved for retail individual investors (RII) was the most sought-after, being subscribed 2.28 times. The quota for non-institutional investors (NII) was booked 1.78 times.
In total, the company received bids for 44.66 lakh shares against the 21.96 lakh shares on offer. The IPO was open for subscription from December 10 to December 12. The basis of allotment was finalized on December 15, and successful allottees saw the shares credited to their demat accounts on December 16.
For investors, the minimum application size was set at 2,000 shares, which translated to a minimum investment of ₹1,26,000 at the lower end of the price band (₹63) and ₹1,30,000 at the upper end (₹65).
Company Background and Use of Proceeds
Founded in September 2016, Unisem Agritech specializes in the research, development, processing, and marketing of seeds for a variety of crops. The company's portfolio includes seeds for vegetables, flowers, and field crops. It employs conventional breeding methods to develop hybrid seeds that promise higher yields, better quality, and improved resistance to diseases and pests compared to traditional varieties.
The capital raised through this IPO is earmarked for several corporate purposes. The company stated that the net proceeds will be utilized for:
- Meeting its working capital requirements.
- Repaying certain banking facilities availed by the company.
- General corporate purposes.
The book-running lead manager for the issue was GetFive Advisors, and Kfin Technologies Ltd acted as the registrar to the offer.
Disclaimer: This news article is for informational and educational purposes only. The views and market data mentioned are not investment advice. Investors are strongly advised to consult with certified financial experts and conduct their own research before making any investment decisions, as market conditions are subject to rapid change.
