After being oversubscribed, why is the Malpani Pipes IPO listing negative?

The IPO was oversubscribed 147 times and listed at a premium of ₹2 per share. However, the grey market premium (GMP) for the IPO was volatile, with the lowest GMP being ₹2 and the highest being ₹28. This suggests that the IPO may have been overvalued, and the listing price may not have been sustainable.

Here are some possible reasons why the Malpani Pipes IPO listed in negative:

• Overvaluation: The IPO may have been overvalued, which means that the issue price was higher than the fair value of the company's shares. This can happen when there is a lot of hype surrounding an IPO, or when the company's financial performance is not as strong as it appears.
• Weak market sentiment: The overall market sentiment may have been weak at the time of the listing, which could have led to investors selling their shares. This can happen when there are concerns about the economy, or when there is a lot of uncertainty in the market.
• Profit booking: Some investors may have bought the shares in the IPO with the intention of selling them as soon as they were listed. This can put downward pressure on the share price.

It is important to note that the IPO market is very volatile, and share prices can fluctuate significantly in the short term. Therefore, it is important to do your own research before investing in any IPO.

Here are some things to consider when evaluating an IPO:

• The company's financial performance: Look at the company's revenue, profitability, and debt levels.
• The company's business model: Understand how the company makes money and what its competitive advantages are.
• The company's management team: Assess the experience and track record of the management team.
• The IPO price: Compare the IPO price to the company's peers and to its own historical valuation.
• The market sentiment: Consider the overall market sentiment and how it might affect the IPO.