Senco Gold IPO Subscription Day 2: The initial public offering of Senco Gold, a prominent jewellery player in the eastern part of India, opened for subscription on Tuesday and will be available for the public to bid till July 6. The company’s shares are expected to get listed on both exchanges.
Senco Gold IPO: Subscription Status
Against an IPO size of 9.42 million equity shares, bids for 6.53 million were received till 5 pm on the first day of the proposed `405 crore IPO, according to data available on BSE.
The portion for non-institutional investors (NII) was subscribed 0.62 times. Against 2.69 million equity shares offered for the qualified institutional buyers (QIBs) portion, bids were received for only 3,290 shares.
For the retail individual investors (RIIs) portion, the public offer received bids for 5.26 million shares against 4.7 million shares set aside, the BSE data showed.
Senco Gold IPO: Allotment & Listing Date
The allotment of shares has been scheduled for July 11, while the credit of shares will be on July 13. The shares will be listed on exchanges on July 14. On the upper price band, the firm is valued at Rs 2,460 crore.
Senco Gold IPO: OFS
The issue consists of a fresh issue of Rs 270 crore and an offer-for-sale of up to Rs 135 crore by its promoter SAIF Partners India IV Ltd. SAIF Partners has 19.23 per cent stake in the firm.
Senco Gold IPO: Price Band
The company has fixed the price band for the issue at Rs 301-317 per share. About 50 per cent of the offer is reserved for qualified institutional buyers, 15 per cent for non-institutional, and 35 per cent for retail investors.
Senco Gold IPO: Objective
The company proposes to utilise the proceeds from the fresh issue for funding working capital requirements and general corporate purposes.
Senco Gold IPO: About Company
Senco Gold is the largest, organised jewellery retail player in eastern India. The company primarily sells gold, diamond, and platinum jewellery, and also that of silver, other precious and semi-precious stones and metals. It runs 136 showrooms across 96 cities and towns in 13 states throughout India.
The book running lead managers to the Senco Gold 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 against Rs 3,534.64 crore a year ago, while its net profit for the year stood at Rs 158.48 crore versus Rs 129.10 crore last year.
Senco Gold IPO GMP
Senco Gold shares have started to trade in the unlisted stock market and shares of the jewelry company are available at a premium of Rs 102 in the grey market today. However, stock market analysts warned IPO investors to make an investment decision only on the basis of GMP. Analysts said that GMP is unofficial and non-regulated data. It has nothing to do with the company’s financials. They advised investors to look at the concrete fundamentals available on the balance sheet of the company.
What Do Analysts Say?
At the upper price band of Rs 317, Senco Gold is available at a P/E of 15.5x its FY23 earnings, which is lower than industry peers’ valuations, Geojit Financial Services said, while assigning a “subscribe” rating to the offer.
“A strong brand name and a legacy of over five decades, strong company-operated showrooms, and an established asset-light ‘franchise’ model are expected to benefit the company,” Geojit said.
“The company has demonstrated one of the best financial performances among peers. Hence, based on current performance, we assign Subscribe for listing gain. At a higher price band, Senco is commanding a P/E multiple of 13.9x (on FY23 EPS on upper price band), which is lower than the peer average,” said SMIFS.
SBI Securities believes the company’s strong legacy in the jewellery business allows it to grow market position in other parts of the country.
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