Godavari Biorefineries IPO day 3: GMP, subscription status to review. Apply or not?

Godavari Biorefineries IPO: The initial public offering (IPO) of Godavari Biorefineries Limited opened for bidding on 23rd October 2024. The public issue will remain open until 25th October 2024. The ethanol-based chemical maker company has fixed the Godavari Biorefineries IPO price band at ₹334 to ₹352 per equity share. The book build issue combines a fresh issue and an Offer for Sale (OFS). The company aims to raise ₹554.75 crore from Godavari Biorefineries IPO, out of which ₹325 crore is aimed through the issuance of fresh shares. The initial offer is proposed for listing on the BSE and the NSE. As per the Godavari Biorefineries IPO subscription status, the public issue has received a tepid response from the Indian primary market investors in the first two days of bidding.

Meanwhile, shares of Godavari Biorefineries Limited have become available in the grey market. According to stock market observers, company shares are available at a premium of ₹15 in the grey market.

Godavari Biorefineries IPO GMP

As mentioned above, the Godavari Biorefineries IPO GMP (Grey Market Premium) today is ₹15, which means the grey market is expecting a listing gain of ₹15 per share. The grey market was neutral on the book build issue on the Godavari Biorefineries IPO subscription opening date. 

Godavari Biorefineries IPO subscription status

By 4:10 pm on the third day of subscription on Friday, the issue had been subscribed 1.80 times. The retail portion had been subscribed 1.65 times, and the NII segment had been booked 0.90 times by that time. The segment reserved for QIBs was subscribed 2.76 times. 

After two days of bidding, the book build issue had been subscribed 0.54 times, the retail portion of the public issue had been booked 0.96 times, and the NII segment of the public offer had been booked 0.26 times.

Godavari Biorefineries IPO review

Giving a 'subscribe' tag to Godavari Biorefineries IPO, Prathamesh Masdekar, Research Analyst at StoxBox, said, "Godavari Biorefineries is a prominent ethanol-based chemical manufacturer in India, running an integrated biorefinery. Its diverse product portfolio includes bio-based chemicals, sugar, ethanol, and power, serving food, pharmaceuticals, personal care, and fuel sectors. The company leverages strong customer relationships in sugar and bio-chemicals to cross-sell products while continuously exploring new diversifying opportunities. With the Indian ethanol market projected to grow from USD 7.0 bn in 2023 to USD 17.5 bn by 2028 at a 20% CAGR, Godavari is well-positioned to benefit, especially in fuel additives, disinfectants, and beverages."

"Financially, the company aims to lower its debt-to-equity ratio, enabling future growth. Godavari's long-term outlook is solid, supported by strong business performance, operational efficiency, and R&D initiatives. Despite the high P/E ratio of 120.1x for FY24, the company's growth potential and industry tailwinds make it a promising investment, justifying a SUBSCRIBE rating," the StoxBox expert added.

Assigning an 'apply' tag to the public issue, Mahesh M Ojha, AVP — Research at Hensex Securities, said, "Godavari offers a diversified product portfolio with a well-established relationship with a diversified marquee customer base across industries and geographies. Moreover, it has well-developed in-house research and development capabilities. The company is a leading manufacturer in the Maharashtra Karnataka Belt and is set to benefit from rising ethanol demand; the company will reduce debt / Repayment of ₹240 Crore from the IPO Proceeding, strengthening its Balance Sheet. Considering the abovementioned factor, we assign 'SUBSCRIBE' to the Medium to Long Term Investment issue."

Godavari Biorefineries IPO details

The most likely date for Godavari Biorefineries IPO allotment is 26th October 2024, i.e., this Saturday. If the share allocation is not declared this Saturday, the likely date for Godavari Biorefineries IPO allotment would be Monday next week. Likewise, the most likely date for Godavari Biorefineries IPO listing is 30th October 2024.

Disclaimer: The views and recommendations above are those of individual analysts, experts, and brokerage firms, not Mint. We advise investors to consult certified experts before making any investment decisions.