A new ASX 100 is in the making with demand high for the Medibank Private float shares.
The retail offer closed on Friday and investors are waiting the final price and how many shares they have been allocated for the stock debut on Tuesday next week.
The retail investors asked for $4.8 billion in shares.
The government had expected to raise up to $5.5 billion, but the current demand for retailers, on top of the brokers, indicates a market capitalisation higher than this, as much as 10% higher.
Finance Minister Mathias Cormann says a decision hasn’t yet been made on the overall split of share allocations between the retail and institutional offers.
The official offer prices is in range of $1.55 to $2 but the shares have been trading on shadow markets at more than this.
The indicative market capitalisation is $4.269 billion to $5.508 billion which would place Medibank Private among the top 100 companies on the ASX.
Evan Lucas, market strategist at IG Markets, told Business Insider that the grey market is currently pricing the shares at $2.12, as this chart shows.
The price has come off a bit but demand is still strong at 6% above the high end of the range.
If the government sticks to it maximum $2 per share price then retail investors can expect premium on top of that on the first day of trading.
Medibank has about 29% of the $21 billion health insurance market in Australia.