Sai Silks Kalamandir, one of the top 10 retailers of ethnic apparel in South India, made a subdued entrance into the stock market on Wednesday. On the National Stock Exchange (NSE), the company's shares were listed at ₹231 per share, marking a 4.1% premium over the issue price of ₹222. Meanwhile, on the Bombay Stock Exchange (BSE), shares were listed at ₹230 per share.
The initial public offering (IPO) of Sai Silks Kalamandir was open for subscription from Tuesday to Thursday last week. The subscription status revealed a demand of 4.40 times the total shares on the final day of subscription. The retail investors' portion was subscribed 88%, while the Non-Institutional Investors (NII) portion was subscribed 2.47 times. The Qualified Institutional Buyers (QIB) showed strong interest, subscribing 12.35 times.
The IPO comprised a fresh issuance of ₹600 crore (INR100 crore = approx. USD12 million) worth of shares and an offer for sale (OFS) of up to 2.70 crore equity shares by the promoter and promoter group. The company plans to use the net proceeds from the offering to finance capital expenditures for establishing 30 additional stores and two warehouses, as well as for working capital needs, debt repayment, and general corporate purposes.
Motilal Oswal Investment Advisors Ltd, HDFC Bank Ltd, and Nuvama Wealth Management Ltd were the book running lead managers to the offer, with Bigshare Services Private Ltd serving as the offer's registrar.
In terms of financial performance for the fiscal year ending March 2023, Sai Silks Kalamandir reported robust results with its net profit rising 69.1% YoY to ₹97.6 crore, due to strong operating performance compared to ₹57.7 crore in the previous year. During the same period, its revenue from operations increased by 19.7% to ₹1,351.5 crore in FY23 versus ₹1,133.02 crore in FY22.
The grey market premium (GMP) for Sai Silks Kalamandir was ₹8 on Wednesday, indicating investors' readiness to pay more than the issue price. In the grey market, Sai Silks Kalamandir share price was trading at a premium of ₹8 on Wednesday.
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