Senco Gold IPO: Impressive Opening with 35.6% Share Price Premium
In an initial public offering (IPO), Senco Gold Ltd. saw its shares launch on stock markets on Friday with a sizable premium. The NSE listed the stock for 430 rupees per share, a 35.6% premium over the initial offering price. Similar to how it opened on the BSE, the share price was 431.
The price range for the IPO had been set by the business at 301 to 317 rupees per share.
“Senco Gold’s IPO made a strong entry into the stock market today, with an opening price of 430 per share, representing a premium of 36% over the upper end of the price band at 317,” said Anubhuti Mishra, an equity research analyst at Swastika Investmart Ltd. This substantial listing meets expectations. Given the company’s optimistic growth prospects, existing investors may think about keeping the shares for the long term with a stop loss of around 387, even if we do not advise new purchases at the current level.
The public issue’s subscription period began on Tuesday, July 4, and ended on Thursday, July 4. Qualified institutional buyers (QIBs), retail investors, and non-institutional investors (NIIs) responded well to the IPO throughout the subscription period. Retail investor component received a 16.28 times oversubscription, QIBs a 190.56 times oversubscription, and NII a 68.44 times oversubscription. The overall issuance was 77.25 times oversubscribed.
The IPO consists of a new share issue for 270 crore rupees and an offer-for-sale (OFS) of equity shares for 135 crore rupees by investor SAIF Partners India IV. The net proceeds from the new issuance will be used to fund the company’s working capital needs as well as general business requirements.
Senco Gold received 121.50 crore from 21 anchor investors prior to the IPO subscription. Renowned investors including Nippon MF, White Oak, Jupiter Asset Management, Bandhan MF, 3P India Equity Fund (Prashant Jain’s fund; the fund’s first IPO investment), Max Life Insurance, Sundaram MF, and Franklin Templeton MF were highlighted in the anchor book.
Senco Gold is well-known for selling jewellery in Eastern India and has a sizable clientele. The firm now has a sizable retail network with 136 showrooms, 96 cities, and store networks spread throughout 13 States/UTs.
The firm has previously demonstrated exceptional financial success, with a two-year CAGR for sales of 24% and a six-year CAGR for profit after tax of 61%.
Senco Gold increased their net profit from the prior year’s 129.10 crore to 158.48 crore in the fiscal year 2023. Its revenue for the same time period was $4,077.40 crore, up from $3,534.64 crore the year before.
About Senco Gold:
Senco Gold Limited functions as a jewelry store, providing a wide range of gold and diamond jewelry options. Their offerings include earrings, necklaces, bangles, coins, bars, pendants, rings, bracelets, chains, and gold coins. Senco Gold primarily serves customers in India.
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