What 'grey market premium' means, and why wealthstar.in doesn't report it

Around every IPO, you will see a number quoted as the “grey market premium”, or GMP: an amount, in rupees per share, that shares are said to be changing hands for before they list on an exchange. It is easy to find and it is quoted constantly during a subscription window. It is also not published, verified or regulated by any exchange or by SEBI.

What the term describes

The grey market is a name for informal, off-exchange trading in shares (or the right to receive an allotment) that has not yet listed. Trades there are not routed through NSE or BSE, are not settled by a clearing corporation, and are not covered by the investor-protection mechanisms that apply to on-exchange trading. The “premium” is simply the gap between that informal price and the IPO’s issue price, as reported by whoever is quoting it.

Why it isn’t part of the official process

The documents that govern an IPO — the price band, the lot size, the issue dates, the objects of the issue and the risk factors — come from the company’s offer document and the exchanges’ own announcements. None of these publish a grey-market figure, because the grey market sits outside the listing and settlement system they run. A number with no exchange, clearing corporation or regulator behind it cannot be checked the way a price band or an allotment date can.

Why wealthstar.in doesn’t report it

A figure that changes by the hour, has no published source, and is used mainly to suggest whether an issue will do well is, in substance, a call on a security. Making that kind of call is what SEBI’s Research Analyst Regulations, 2014 govern, and registration under them is what those rules require. wealthstar.in is not registered as a research analyst, so it does not publish subscribe/avoid views, price forecasts, or any figure whose main use is to imply one — grey-market premium included.

This is a policy choice about what the site publishes, not a claim that the grey market is illegal or that everyone who quotes a premium is wrong. It is simply not something this site can verify, and not something it uses to suggest an outcome.

What this site reports on an IPO instead

The price band and how the minimum bid amount is worked out, the lot size, the subscription and listing dates, the issue size and its stated objects, and the risk factors the company itself has disclosed — see how to read an IPO price band and lot size and the complete guide to how an IPO works.