Aether Industries made a strong debut in the secondary market on Friday with the stock of the specialty chemicals manufacturer listing at Rs 706.2 apiece on BSE, a premium of Rs 64.2 or 10 percent.

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On NSE, the Aether Industries stock began its journey at Rs 704 apiece, a premium of Rs 62 or 9.7 percent, over the upper end of its IPO price range.

The market debut was much better than the trend seen in the grey market — an unofficial market for unlisted shares, where dealers said Aether commanded a premium of Rs 10-20 over the past few days.

Source: IPO Watch

ALSO READ: What grey market really is

Dinesh Gupta, Co-Founder of UnlistedZone — a firm that deals in unlisted shares, told CNBCTV18.com that Aether, despite being a good company with an experienced management in the segment, is demanding a "very costly" valuation.

"It is coming at a price-to-earnings (ratio) of 72 times, which looks overvalued compared to its peers. This is why the (IPO) subscription was low. The broader market is not favourable for IPOs and we expect same to be followed here," he said.

Here's where Aether stands among its peers in terms of valuation:

Abhay Doshi, Co-Founder of Unlisted Arena, a portal that tracks grey markets, had expected Aether shares to debut on BSE and NSE at a premium of around 3-5 percent (Rs 661-674).

The issue was richly priced though the company's experienced promoters, decent margins and impressive top-bottom line growth work in its favour, he said.

Aether's IPO, a combination of fresh issuance and an offer for sale to raise up to Rs 808 crore, saw an overall subscription of 6.3 times.

The Aether issue was open for bidding in a range of Rs 610-642 in multiples of 23 from May 24 to May 26.

At the higher end of the price band, one lot of Aether shares is worth Rs 14,766.

Here's a look at the company's financials:

*Except operating margin, all figures in crore rupees

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First Published:Jun 2, 2022 5:17 PM IST