Senco Gold IPO Subscription Day 2: The IPO of Senco Gold, a prominent jewelery player in eastern India, is open for subscription on Tuesday and will be available for the public to bid until July 6. The company’s shares are expected to be listed on both exchanges.
Senco Gold IPO: Subscription status
At an IPO size of 9.42 million shares, bids for 6.53 million were received by 5pm on the first day of the proposed `405 crore IPO, according to data available on BSE.
The section for non-institutional investors (NII) was subscribed 0.62 times. Against the 2.69 million shares tendered for the Qualified Institutional Buyers (QIBs) portion, bids were received for only 3,290 shares.
For the portion of retail private investors (RIIs), the public offering received bids for 5.26 million shares against 4.7 million reserved shares, the BSE data showed.
Senco Gold IPO: allocation and listing date
The allocation of shares is scheduled for July 11, while the crediting of the shares will be on July 13. The shares will be listed on stock exchanges on July 14. In the upper price range, the company is valued at Rs 2,460 crore.
Senco Gold IPO: OFS
The issue consists of a new issue of Rs 270 crore and an offer for sale of up to Rs 135 crore by the promoter SAIF Partners India IV Ltd. SAIF Partners has a 19.23 percent interest in the company.
Senco Gold IPO: price range
The company has set the price range for the issue at Rs 301-317 per share. Approximately 50 percent of the offering is reserved for qualified institutional buyers, 15 percent for non-institutional investors and 35 percent for retail investors.
IPO of Senco Gold: target
The company proposes to use the proceeds from the new issue to fund working capital needs and general corporate purposes.
Senco Gold IPO: About the company
Senco Gold is the largest organized jewelery retailer in East India. The company mainly sells gold, diamond and platinum jewellery, but also silver jewellery, other precious and semi-precious stones and metals. It has 136 showrooms in 96 cities and towns across 13 states across India.
The lead managers of Senco Gold’s IPO are IIFL Securities, Ambit Pvt Ltd and SBI Capital Markets Ltd, while Kfin Technologies is the IPO registrar.
For FY23, Senco reported a revenue of Rs 4,077.40 crore as compared to Rs 3,534.64 crore a year ago, while its net profit for the year was Rs 158.48 crore versus Rs 129.10 crore last year.
Senco Gold IPO GMP
Senco Gold shares are traded on the unlisted stock market and shares of the jewelry company are available today at a premium of Rs 102 on the gray market. However, stock market analysts warned IPO investors to make an investment decision based solely on GMP. Analysts said that GMP is unofficial and unregulated data. It has nothing to do with the company’s finances. They advised investors to look at the concrete fundamentals available on the company’s balance sheet.
What do analysts say?
In the higher price range of Rs 317, Senco Gold is available at a P/E of 15.5x its FY23 earnings, which is below peer valuations, Geojit Financial Services said, while submitting a “subscribe” rating to the bid.
“A strong brand name and legacy spanning more than five decades, strong company-operated showrooms and an established “franchise” model with few assets are expected to benefit the company,” said Geojit.
“The company has shown one of the best financial performances among its competitors. Therefore, based on current performance, we allocate Subscribe for listing profit. In a higher price range, Senco has a P/E multiple of 13.9x (on FY23 EPS in the upper price range), which is below the peer average,” said SMIFS.
SBI Securities believes that the company’s strong heritage in the jewelry sector will enable it to expand its market position in other parts of the country.
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