Saraswati Saree Depot IPO: Saraswati Saree Depot Limited’s initial public offering (IPO) was launched in the Indian primary market today. According to the BSE and NSE website schedules, the Saraswati Saree Depot IPO subscription period would last until August 14, 2024. As a result, the public offering will be open for bids from Monday to Wednesday this week. Saraswati Saree Depot has set a price band of ₹152 to ₹160 per equity share for its IPO.
Saraswati Saree Depot IPO is proposed for listing on the BSE and NSE. The company expects to raise 160.01 crore from its initial offer, including ₹104 crore through additional shares. Meanwhile, shares of Saraswati Saree Depot are available on the grey market ahead of the company’s initial public offering. Saraswati Saree Depot’s IPO GMP (grey market premium) is currently ₹34, as reported by stock market experts.
Saraswati Saree Depot IPO Subscription Status
By 3:00 PM on the first day of bidding, the public issue had been oversubscribed 3.03 times overall, with the retail portion seeing 4.04 times subscription and the NII segment being subscribed 6.87 times. Additionally, the QIB portion of the offering was fully subscribed.
3. Saraswati Saree Depot IPO date: The public issue will be open for bids from August 12 to 14, 2024.
4. Saraswati Saree Depot IPO size: The business plans to raise ₹160.01 crore, with ₹104 crore for new issues. The remaining ₹56.01 crore is earmarked for the offer for sale (OFS).
5. Saraswati Saree Depot IPO lot size: Bidders can apply in lots, and each lot of the book build issuance has 90 company shares.
6. Saraswati Saree Depot IPO assignment date: Shares will most likely be allocated on Friday, August 16th, 2024.
7. Saraswati Saree Depot IPO registrar: Bigshare Services Private Limited has been appointed as the official registrar for the mainboard IPO.
8. Saraswati Saree Depot IPO listing date: Due to the ‘T+3’ listing rule, the first offering may be listed on August 20, 2024, i.e. next Tuesday.
9. Unistone Capital Private Limited has been designated as the Saraswati Saree Depot IPO’s lead manager.
Saraswati Saree Depot IPO: Should you apply or not?
10. Saraswati Saree Depot IPO Review: Akriti Mehrotra, Research Analyst at StoxBox, assigned a ‘subscribe’ rating to the public issue, highlighting the unique investment potential of Saraswati Saree Depot Ltd. (SSDL). The company, known for its established B2B saree wholesale business, caters to a broad network of semi-wholesalers and retailers. SSDL’s expansion into kurtis, dress fabrics, and men’s suits has driven notable revenue and profit growth. The firm’s strategic focus on enhancing inventory management, expanding into men’s ethnic wear, and growing its e-commerce platform is expected to further boost growth. With an appealing P/E ratio of 17.9x based on FY24 earnings, the IPO is recommended as a “SUBSCRIBE” for investors with a medium to long-term perspective.
Ventura Securities has also awarded a’subscribe’ tag to the public offering, noting that “Financially, SSDL has exhibited sustained growth throughout the years. In FY24, the company’s total revenues surpassed INR 6,000 million, a considerable rise from INR 4,094 million in FY 21. The company’s PAT has also increased significantly, rising from INR 34.51 million in FY14 to INR 126.12 mn in FY21, representing a CAGR of 20.34%. As SSDL prepares for its future IPO with an offer size of around INR 1,600 million, it intends to use this capital to cover its working capital requirements as well as general corporate reasons, positioning itself for further expansion and market supremacy.”
Saraswati Saree Depot IPO GMP Today
According to market experts, Saraswati Saree Depot Ltd’s unlisted shares are trading Rs 65 higher on the grey market than their issue price. The Rs 65 grey market premium, or GMP, indicates that the grey market expects a listing gain of 40.62 percent from the public offering. The GMP is based on market sentiment and is constantly changing.
The ‘grey market premium’ indicates that investors are willing to pay above the issue price.
Saraswati Saree Depot Offical Website: Click Here
Analyst Recommendations for Saraswati Saree Depot’s IPO
Most analysts have assigned a’subscribe’ rating with a medium to long-term perspective. However, few have cautioned investors to be wary of the company’s negative cash flow.
Swastika, a brokerage business, stated in its IPO note that Saraswati Saree Depot is a leading participant in the saree wholesale category with a wide supplier and customer base. Its diverse product offerings and bulk purchasing capabilities provide it a competitive advantage. While the company’s profitability has remained consistent, negative cash flow continues to be a worry.
“The saree wholesale industry is highly competitive and fragmented, with low profit margins and significant seasonality.” Despite these problems, Saraswati Saree appears to have a respectable P/E ratio of 17.93. Given the industry dynamics, competitive landscape, and cash flow concerns, we suggest this IPO to investors with a high risk tolerance and long-term perspective,” Swastika added.
Stoxbox, a brokerage firm, issued a ‘subscribe’ recommendation for the IPO, citing the company’s strategic initiatives such as improving inventory management, expanding into men’s ethnic wear, and boosting its e-commerce presence. They expressed optimism about the company’s growth prospects and recommended a ‘subscribe’ for the medium to long term due to its reasonable valuation of 17.9 times based on FY24 earnings.
Another firm, Ventura Securities, also assigned a subscribe rating. In its IPO note, Ventura stated that Saraswati Saree Depot’s business strategy is supported by a diverse and well-established supply network. The company sources its products from over 900 weavers and suppliers in India’s important textile cities, including Surat, Varanasi, Kolkata, Madurai, and Bengaluru. This wide supplier network ensures a consistent and varied product flow.
Saraswati Saree Depot IPO: Additional Details
Saraswati Saree Depot Limited, which was created in 1996, manufactures and wholesales women’s clothes. Its core business is wholesale (B2B) sarees. It also wholesales other women’s apparel items such as kurtis, dress materials, shirt pieces, lehengas, bottoms, and so on.
The Rs 160.01 crore Saraswati Saree Depot IPO consists of a fresh issue of 0.65 crore shares totaling Rs 104.00 crore and an offer for sale (OFS) of 0.35 crore shares totaling Rs 56.02 crore.
Investors must apply for at least 90 equity shares and multiples thereof. As a result, the minimum investment for ordinary investors would be Rs 14,400 [90 (lot size) x Rs 160 (upper price band).
Unistone Capital Pvt Ltd is acting as the book-running lead manager for the Saraswati Saree Depot IPO, while Bigshare Services Pvt Ltd is the registrar for the issue.
Saraswati Saree Depot’s sales increased by 2% in the fiscal year 2023-24, while its profit after tax (PAT) increased by 29%.
