Senco Gold IPO GMP, Subscription, Review; Should You Buy on Last Day?

Senco Gold IPO Subscription Day 3: The Rs 405-crore public issue is set to close on July 6. On its second day of bidding, the issue continued to get a decent response from investors, subscribing 2.07 times as per the subscription data available on exchanges.

Senco Gold IPO: Subscription Status

So far retail investors and high-networth individuals remained at the forefront to support the offer, buying 3.05 times and 2.34 times the allotted quota, while qualified institutional investors have bid 14 per cent shares of the portion set aside for them.

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

Jewellery retailer Senco Gold shares enjoyed more than 35 per cent premium in the grey market over the upper end of the price band, analysts said on anonymity to Moneycontrol.com. 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?

Hem Securities likes the business model of company and growth rate at which company has grown its topline & bottom line over the period of time. Looking after decent financials & reasonable valuation, the brokerage recommends subscribing to the issue.

“Debt to equity of the company stands at 1.25x for FY2023 as compared to industry average of 0.80x, which can create pressure on the future prospects of the company,” Canara Bank Securities said. Hence, they advised that investor needs to be cautious about the company’s higher debt.