The share allotment for Paytm’s initial public offering (IPO) is done and all eyes are now on the online payment firm’s stock market listing on November 18. The share allotment was finalised on Monday.

Paytm’s Rs 18,300 crore IPO is the largest in the country’s history and it was subscribed a total of 1.89 times. Ahead of tomorrow’s listing, it has come to light that the payment firm’s shares are losing momentum on the grey market.

Paytm IPO’s grey market premium (GMP) has fallen sharply over the past few days, indicating a flat or discounted opening. As of today, the IPO’s GMP is in negative territory as the shares of the company are available on the grey market at a discounted price of Rs 30.

An India Today Infographic: The Paytm IPO

This is a sharp drop from last week when the shares of the company were trading at a premium of Rs 150 on the grey market. It may be noted that Paytm IPO’s GMP fell to zero on Tuesday and has entered negative territory today.

The dip in GMP is an indicator that Patym may see a discounted or flat listing on the stock markets tomorrow. However, the fall in GMP could also be due to the weak stock market momentum witnessed over the past few days. It is also worth noting that the GMP of a public issue offers tentative insight regarding listing gains or losses.

WHAT GMP INDICATES?

If the public issue’s GMP remains in negative territory, it indicates that the grey market expects the IPO to list at Rs 2,120, compared to its upper price band of Rs 2,150. The price band for Paytm’s IPO was fixed at Rs 2,080-2,150 per equity share.

While Paytm’s IPO crossed the line with marginal oversubscription, it did not create the same buzz as Zomato, Nykaa and other major IPOs. However, Paytm’s IPO is much bigger in size than all the other successful IPOs in the recent past.

Several analysts asked investors to subscribe to Paytm’s IPO for long-term gains as the company is expected to witness substantial growth in its payment business. On the other hand, some analysts were wary about the public issue due to the high valuations, continuous losses and future growth prospects.