By Divyansh PokharnaLast week was a mixed bag for the market. The Nifty 50 declined by 0.1%. According to CPI data released on December 12, India’s retail inflation eased to 5.5% compared to 6.2% in October, in-line with estimates. However, persistently high food prices have raised concerns about potential delays in interest rate cuts by RBI. The new RBI Governor, Sanjay Malhotra, could mark a shift in interest rate policy nevertheless. Analysts expect the RBI to begin rate cuts at its next monetary policy review in February 2025.
Meanwhile, IPO activity has stayed strong in the last month of 2024 - four companies debuted last week, eleven more are set to list this week, while nine IPOs are opening for subscription.
We take a look at the IPO activity scheduled for this week:
Four new companies debuted on the bourses in the past week
The stock market saw four IPOs debut last week, with one debuting in the mainline segment and three in the SME category.
Emerald Tyre & Dhanlaxmi Crop witness stellar listings
Emerald Tyre Manufacturers, an auto tyres company, debuted on the NSE SME platform with an impressive 90% premium on December 12. The Rs 49.3 crore issue received an overwhelming subscription of 488.5X, including a remarkable 734.8X in the retail category. The auto tyre industry has grown by 6.8% in the past month.
Nisus Finance Services, a financial services company, listed on the bourses on December 11, delivering a 25% listing gain. Its current gain stands at 50.8%. The IPO saw robust demand, with a total subscription of 177.6X, including an impressive 592X subscription in the HNI category. In FY24, the company’s revenue grew 3.7X YoY, while net profit surged 7.6X.
Dhanlaxmi Crop Science, an agricultural products company, attracted total bids of 565X for its IPO, including a record HNI subscription of 1,722.9X. The company’s revenue in H1FY25 nearly doubled compared to its FY24 revenue. It debuted on December 16 with a strong listing gain of 90%.
Property Share Investment Trust, a realty firm, set its issue price at Rs 10,50,000, targeting HNIs, corporates, and institutional investors, with a minimum investment requirement of Rs 10 lakh. The IPO received a QIB subscription of 0.1X and other investor subscriptions of 4.4X, with no participation from HNIs. It listed at its issue price on December 10 but declined by around 1% shortly after.
It’s a busy week ahead with eleven IPOs set for listing
Investors can expect a packed week with eleven IPOs set to list – five in the mainline segment and six in the SME category.
One Mobikwik and Vishal Mega Mart see strong QIB demand
One Mobikwik, a software company offering prepaid digital wallets and online payment services, has seen the highest subscription for mainline IPOs this week, with a total subscription of 119.4X. The company’s IPO, with an issue size of Rs 572 crore, is set to list on December 18.
Department stores company Vishal Mega Mart has received total bids of 27.3X and a significant QIB subscription of 80.8X. The company, which offers a wide range of products including apparel, groceries, electronics, and home essentials, is set to list on December 18. With an issue size of Rs 8,000 crore, its post-IPO price-to-earnings* (PE) ratio stands at 69.2, below the industry average of 113.6.
Sai Life Sciences, a pharma company, has received total bids of 10.3X for its IPO, with an issue size of Rs 3,042.6 crore. The company is scheduled to list on December 18. Meanwhile, healthcare services company Inventurus Knowledge Solutions has garnered a subscription of 52.7X, with an issue size of Rs 2,497.9 crore, and is set to list on December 19.
The International Gemmological Institute, a misc. commercial services company that certifies and grades diamonds, gemstones, and jewelry, has received low demand on day 2 of its IPO, with a subscription of just 0.7X. The IPO, closing on December 17, is set to list on December 20.
During the past week, Toss The Coin, Jungle Camps and Purple United witnessed strong subscriptions across different investor categories.
Toss the Coin, Jungle Camps lead in terms of subscription rates
Toss the Coin, a consulting service specializing in Go-To-Market (GTM) strategies for B2B tech companies, led SME IPO subscriptions this week, receiving a remarkable 952.6X overall and 2,060.8X from retail investors. With an issue size of Rs 9.2 crore, the company offers services like branding, content creation, and customer success management. Its PE ratio post-IPO is 14.8, below the industry average of 31.8. The company is set to list on December 17.
Jungle Camps India, a company operating wildlife camps, hotels, motels, inns, and other hospitality services across India, has seen strong demand for its IPO with total subscriptions of 460X and an issue size of Rs 29.4 crore. Post-IPO, the company’s PE ratio stands at 31.1, significantly lower than the industry average of 65. The company is set to list on December 17.
Supreme Facility Management, a provider of integrated facility management services including housekeeping and corporate food services, received bids for 25.7X of its shares. Post-IPO, the company’s PE ratio stands at 19.6, below the industry average of 56.
Other companies receiving notable demand include Purple United Sales, an apparel and accessories company, which saw a 148.9X subscription for its Rs 32.8 crore IPO, is set to list on December 18. Yash Highvoltage, a heavy electrical equipment firm, received 169.2X total subscriptions, with HNI subscriptions at 244.5X. The company, with an issue size of Rs 110 crore, is set to list on December 19. Hamps Bio, a food products company, attracted 186X subscription for its Rs 6.2 crore IPO and will list on December 20.
*Note: The post-issue P/E ratio is calculated using the issue price divided by the post-issue EPS, based on annualized FY earnings as of March 31, 2024, from the RHP.
Upcoming subscriptions: Nine new offerings are set to open this week, mainline dominates
Nine IPOs are scheduled to open for subscription this week, including six in the mainline segment and three in the SME category.
Most companies witness revenue growth during FY24
Transrail Lighting: This heavy electrical equipment and engineering company focuses on power transmission and distribution, along with manufacturing lattice structures, conductors, and monopoles.
The company is launching a mainline IPO with an issue size of Rs 838.9 crore to meet incremental working capital requirements, fund capital expenditure, and address general corporate purposes. The issue opens on December 19 and closes on December 23, with shares set to list on December 27. In FY24, the company reported a 30.2% YoY increase in revenue and a 116.8% rise in net profit.
DAM Capital Advisors: This capital markets company is set to launch its Rs 840.3 crore mainline IPO, a complete offer for sale, on December 19 and close on December 23, with listing scheduled for December 27.
DAM Capital Advisors Limited, an investment bank in India, provides financial solutions in investment banking (ECM, M&A, PE, structured finance advisory) and institutional equities (broking and research). In FY24, the company’s revenue increased by 114% YoY, while net profit surged by 713%.
Mamata Machinery: This industrial machinery manufacturer, specializing in machines for plastic bags, pouches, packaging, and extrusion equipment, is launching a Rs 179.4 crore mainline IPO, entirely an offer for sale.
The issue opens on December 19 and closes on December 23, with the listing scheduled for December 27. The company serves the packaging industry with tailored manufacturing solutions. In FY24, the company’s revenue grew by 14.8% YoY, while net profit rose by 60.5%.
Sanathan Textiles: This textiles company, a polyester yarn manufacturer and global supplier of cotton yarn, operates through three business verticals: polyester yarn products, cotton yarn products, and yarns for technical textiles and industrial uses.
The Rs 550 crore mainline IPO, launching on December 19 and closing on December 23, aims to repay borrowings, invest in its subsidiary Sanathan Polycot Private Limited, and fund general corporate purposes.
In FY24, the company’s revenue decreased by 11% YoY, while net profit dropped by 12%. The listing is scheduled for December 27.
Concord Enviro Systems: This non-electrical utilities company provides global water and wastewater treatment solutions, including zero-liquid discharge (ZLD) technology.
The Rs 500.3 crore mainline IPO opens on December 19 and closes on December 23, with the listing scheduled for December 27. The IPO aims to fund capital expenditures for its greenfield and brownfield projects in the U.A.E and Vasai, respectively, along with investments in subsidiaries for working capital, debt repayment, and technology growth.
The company saw a 46% YoY increase in revenue and a 655% rise in net profit during FY24.
Ventive Hospitality: This company operates in the hotels industry, focusing on luxury hotels and resorts for both business and leisure segments. As of September 30, 2024, it has 11 operational assets in India and the Maldives.
The Rs 1,600 crore mainline IPO opens on December 20 and closes on December 24, with listing scheduled for December 30. The proceeds will be used for the repayment and prepayment of borrowings, including interest payments, and investments in step-down subsidiaries. The company will also allocate funds for general corporate purposes.
The company has reported inconsistent financials, with a net loss of Rs 137.8 crore in H1 FY25, Rs 66.8 crore in FY24, and Rs 146.2 crore in FY22, though it posted a profit of Rs 15.7 crore in FY23.
NACDAC Infrastructure: This construction and engineering company specializes in civil and structural construction, including multi-story buildings, steel structure works, housekeeping and manpower supply, and bridges (FOBs and ROBs). It also undertakes related civil, structural, and electrical works.
The company is launching an IPO to address working capital needs and general corporate purposes. The issue, valued at Rs 10 crore, opens on December 17 and closes on December 19, with shares set to list on the BSE SME on December 24. In FY24, the company reported a 209.5% YoY increase in revenue and a 904.4% rise in net profit.
Identical Brains Studios: This entertainment company will open its Rs 20 crore IPO on December 18, with the issue closing on December 20. The shares are scheduled for listing on the NSE SME platform on December 26.
The company specializes in computer-generated visual effects (VFX) services for films, web series, TV series, documentaries, and commercials. The IPO proceeds will fund the renovation of its Andheri office and studio, the establishment of Colour Grading Digital Intermediate (DI) and Sound Studios, new branch offices in Andheri and Lucknow, facility upgrades with new computers and software, and incremental working capital needs.
In FY24, the company achieved a 150.7% YoY increase in revenue and a 231.5% rise in net profit, reflecting strong financial performance.
Newmalayalam Steel: This iron & steel products manufacturer, based in Kerala, India, specializes in galvanised pipes, tubes, and sheets. In FY24, the company’s revenue decreased by 15.8% YoY, and net profit dropped by 28.9%.
The Rs 41.8 crore SME IPO opens on December 19 and closes on December 23, with listing scheduled for December 27. Proceeds will fund IT/technological upgrades, solar facility expansion, civil construction for a new factory shed, marketing, brand building, incremental working capital, and general corporate purposes.
