Kalyan Jewellers’ IPO on Tuesday witnessed a subscription of 23 percent, so far, on the first day of bidding. Retail investors have put in the highest number of bids as the reserved portion for them has been subscribed 44 percent.
The public issue has so far received bids for over 2.19 crore equity shares against the offer size of 9.57 crore shares, as per the subscription data available on exchanges.
The portion set aside for non-institutional investors is subscribed 5 percent and that of employees is booked 3 percent. Qualified institutional buyers have put in bids for over 1 lakh shares compared to the reserved portion of over 2.72 crore equity shares.
Kalyan Jewellers is planning to raise Rs 1,175 crore through public offer, of which it has already garnered Rs 352 crore from anchor investors on March 15. The issue will close on March 18.
The IPO consists of a fresh issue of Rs 800 crore and an offer for sale of Rs 375 crore by promoter and investors. The price band for the offer was fixed at Rs 86-87 per share.
The brokerage has assigned a subscribe rating to the issue as it expects strong listing gains.
At the upper band of the issue price, Kalyan Jewellers will trade at an EV/EBITDA multiple of 22 times of its annualized 9MFY21 revenue. In comparison, Titan is trading at 79.8x and TBZ at 7.5x, the brokerage said.
Kalyan Jewellers traded at a 7-8 percent premium (Rs 6-7) in the grey market, i.e. at a price of Rs 93-94 against higher price band of Rs 87 per share, the IPO Watch data showed.
Kalyan Jewellers started its jewellery business in 1993 with a single showroom in Thrissur, Kerala. Since then, it has expanded to become a pan-India jewellery company with 107 showrooms across 21 states and union territories in
India.
The company also has an international presence with 30 showrooms in the Middle East as of December 2020. All of its showrooms are operated and managed by the company itself.
Indian jewellery business contributed 78.19 percent to the company’s revenues in FY20, and exports accounted for
21.81 percent. For the nine months ended December 2020, contribution of domestic business to revenue stood at 86.21 percent and exports at 13.79 percent.
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