MVK Agro Food Product lists at a 34% discount on NSE SME

MVK Agro Food Product, a company specializing in sugar production based in Nanded District, Maharashtra had an underwhelming debut on the NSE SME platform. The shares opened at ₹79 each representing a 34.17% discount from their issue price of ₹120. After a weak debut the shares of MVK Agro Food Product faced a 5% upper circuit lock, after a complete trading session on Friday MVK Agro Food Product shares closed at an upper circuit of ₹82.95 representing a strong demand after listing. MVK Agro Food Product IPO opened for subscription on Thursday, 29 February and concluded on Monday, 4 March.

In the M.V.K. Agro Food Product  IPO, retail portion was oversubscribed the most with a subscription rate of 13.01 times while the NII portion had a subscription rate of 3.90 times trailing behind the retail portion. Overall, the IPO received a subscription rate of 8.46 times by the close of the subscription period.

IPO Details

Before the company's stock was officially listed, the Grey Market Premium for the MVK Agro Food IPO was at ₹0, meaning the shares were trading at their initial issue price without any extra cost. However, over the past 14 trading sessions GMP has been fluctuating ranging from ₹0 to ₹30. This indicates that investor sentiment toward the IPO has been changing with some sessions showing more interest and willingness to pay a premium for the shares while others have shown less enthusiasm.

Fund Utilization

The company intends to set up a new facility in Nanded, Maharashtra primarily for manufacturing ethanol and producing/bottling bio-CNG and fertilizer. This strategic move aligns with the company's commitment to sustainable practices and renewable energy initiatives. By setting up these facilities the company aims to contribute to environmental conservation while tapping into emerging markets for renewable fuels and agricultural products. In addition to these specific projects funds raised will also be allocated for general corporate purposes supporting overall business operations and growth strategies.

Established in February 2018, the company specializes in the production of integrated sugar and associated products. Its distribution network involves selling products through intermediaries who then supply them to prominent export houses like PepsiCo Holdings India Private Limited, Parle Biscuits Private Limited and Britannia Industries Limited.

Final Words

Despite its lackluster debut, MVK Agro Food Product remains optimistic about utilizing its IPO proceeds effectively. The company's strategic plans for expansion and diversification signal its commitment to long term growth and sustainability.