On Oct. 3, Vaibhav Jewellers will make their debut. Tepid listing probable following a tepid IPO

 On Oct. 3, Vaibhav Jewellers will make their debut. Tepid listing probable following a tepid IPO

Vaibhav Jewellers IPO | According to analysts who asked to remain anonymous, the company's shares were accessible in the grey market, an unregulated trading venue for IPO shares, at a premium of 3-5 percent over the issue price.

Despite superior financial performance, Manoj Vaibhav Gems N Jewellers, which is known in South India by its brand identification of Vaibhav Jewellers, is anticipated to make a sluggish debut on the stock exchanges on October 3. This could be because of lower-than-expected IPO subscription numbers. At Rs 215 per share, the final issue price has been established.

In the week of September 22–26, subscriptions to the public issue increased by 2.25 times. High net worth people took the lead in supporting the offer by subscribing for 5.18 times the allotted quota, while qualified institutional purchasers and retail investors purchased 1.06 times and 1.66 times the allocated part, respectively.

This business will list under the revised T+3 (issue closing date plus three working days) timeframe, joining Ratnaveer Precision Engineering, Zaggle Prepaid Ocean Services, Samhi Hotels, Sai Silks Kalamandir, and Signature Global.

The market regulator Sebi has mandated it for IPOs starting on December 1 but has asked companies launching IPOs with effect from September 1 to go voluntarily for listing in the T+3 timeframe instead of the existing timeline of T+6.

The stock is worth 11.7 times the company's FY23 earnings. According to analysts who requested anonymity, it was offered at a premium of 3-5 percent above the issue price on the grey market, an unregulated trading venue for IPO shares up until the listing.

According to Dhruv Mudaraddi, research analyst at StoxBox, "the Manoj Vaibhav Gems N Jewellers IPO received a tepid subscription of about 2.25x overall, we expect a flattish opening for the issue on Tuesday."

For Vaibhav Jewellers, senior research analyst Astha Jain at Hem Securities also anticipates a status quo listing.

The company, however, has shown consistent sales growth and even stronger bottom-line development, with profit showing a CAGR of 85.81 percent to Rs 71.6 crore over FY21-FY23 and revenue growing at an average rate of 18.92 percent to Rs 2,027.34 crore during the same time.

In comparison to its previously listed competitors, the jewellery merchant from Andhra Pradesh boasts a 23 percent return on equity for FY23, according to Dhruv.

With 13 showrooms, the hyperlocal jewelry retail business is present in the Telangana and Andhra Pradesh micromarkets. Eight new stores will be opened to focus on Tier-2 and Tier-3 markets, which bodes well given that rural markets accounted for 50 to 52 percent of the overall jewelry market in FY23, according to Dhruv.

Vaibhav Jewellers, which benefits from Andhra Pradesh's early-mover advantage, raised Rs 270.20 crore through its initial public offering, which included a fresh issue of shares worth Rs 210 crore by the company and an offer-for-sale (OFS) of shares worth Rs 60.20 crore by promoter Grandhi Bharata Mallika Ratna Kumari (HUF).

Eight shops will be built as part of the regional jewelry company Grandhi Sai Keerthana, which is run by first-generation female entrepreneur Bharata Mallika Ratna Kumari Grandhi, and her daughter. The remaining monies will be used for general corporate objectives.

A price range of Rs. 204–215 per share has been established for the offer.

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