Recently, the IPO of Resourceful Automobile, a Delhi-based company with 2 showrooms and 8 employees, was in the news, whose issue size was Rs 12 crore and investors had put a bet of Rs 4800 crore in it. Now another SME IPO is in the headlines, named Boss Packaging Solutions and its size was Rs 8 crore, but it received bids of Rs 1085 crore. The reason for it being in the news is not only the bumper subscription it received, but also the photo of this company going viral on social media.
Dilapidated office and 64 employees in the company!
According to the photo and details going viral on social media, Ahmedabad-based Boss Packaging operates from a small space of 500 square yards. 64 employees work in this company and it is being claimed in the viral photo that the condition of its office is dilapidated, which is also visible in the picture. Investors are crazy about this SME IPO and Boss Packaging IPO has received 136.21 times subscription.
Retail investors are impressed with IPO
The IPO of Boss Packaging Company opened on 30 August and investors invested in it till 3 September. The size of the company’s issue was Rs 8.41 crore and under this the company had issued 12,74,000 shares with a face value of Rs 10. The price band (Boss Packaging Price Band) for the shares was Rs 66 and its lot size was 2000 shares i.e. for one lot, investors had to invest at least Rs 132,000. If we talk about subscription, then retail investors were fond of this IPO and subscribed the most at 165.29%, while in other categories it received a total subscription of 103.80%.
‘Old pictures of the company are being posted…’
Some ex-users have called it a wrong way to troll the viral pictures of Boss Packaging’s office on social media. They have written that by sharing new photos of the office, they have said that the pictures by which this company is being trolled are actually many years old. If you look at the company’s website, here too the office of Boss Packaging Solutions looks completely different from the viral pictures. If we look at the financial health of this packaging company, then on 31 March 2023, the company had assets worth Rs 536.12 crore, which became Rs 766.10 crore by 31 March this year. The net profit after tax of the company stood at Rs 101.04 crore in FY24, which was Rs 100.51 crore in the previous financial year.
IPO came under question
First Resourcfull Auto and now Boss Packaging have come under everyone’s notice due to subscriptions many times more than the issue size and with this questions are also being raised. Market analysts are raising questions as to how these small IPOs have received more than 100 percent bids in every category. Let us tell you that earlier Resourceful Automobile SME IPO had received 418 times subscription in the retail category. Let us tell you that the listing of this IPO is to happen tomorrow i.e. on 6 September.
It is worth noting that this company manufactures, supplies and exports diversified packaging machines, self-adhesive sticker labeling machines, conveyors, turntables, web sealers, electric tunnels etc.
SEBI has also warned investors
Market regulator SEBI has also taken cognizance of the growing investor interest in SME IPOs and the strong response being received by small issues. Due to this, on August 28, just before the Boss Packaging IPO opened, the regulator had advised investors to be cautious in SME investments. SEBI had said that one should be cautious of companies presenting the positive conditions of the company in a wrong manner or by manipulation and should not fall prey to social media tips or any kind of rumors.
(Note- Before making any investment in the stock market or IPO market, please consult your market experts.)
Source (PTI) (NDTV) (HINDUSTANTIMES)