What is IPO GMP (Grey Market Premium)?
Grey Market Premium (GMP) is the price at which IPO shares are traded in the unofficial grey market before they officially list on the stock exchange (NSE or BSE). The grey market is an informal market where buyers and sellers trade IPO shares outside the regulatory framework.
If an IPO has an issue price of ₹500 and the GMP is ₹100, it means grey market participants are willing to buy and sell the shares at ₹600 — ₹100 above the issue price. This suggests strong demand and a potential listing gain of approximately 20%.