Unlisted shares of Motisons Jewellers Ltd are currently trading Rs 109 higher in the grey market, which is a 198.18 per cent listing gain from the public issue
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Motisons Jewellers IPO: The initial public offering of Jaipur-based retail jeweller company Motisons Jewellers Ltd, which was opened for public subscription on Monday, December 18, has received an overwhelming response. Till 10:40 am on the second day of bidding on Tuesday, the Rs 151.09-crore IPO has got 22.03 times subscription, receiving bids for 42,37,23,250 shares as against 1,92,29,700 shares on offer.
The IPO will remain open till Wednesday, December 20.
The category meant for non-institutional investors received 25.83 times subscription, while the quota for retail individual investors (RIIs) got subscribed 32.96 times. The qualified institutional buyers category has been subscribed 0.07 times.
The Motisons Jewellers IPO allotment will take place on December 21, while its listing will take place on December 26 on both BSE and NSE.
Motisons Jewellers IPO GMP Today
According to market observers, unlisted shares of Motisons Jewellers are currently trading Rs 109 higher in the grey market as compared with its issue price. The Rs 109 grey market premium or GMP means the grey market is expecting a 198.18 per cent listing gain from the public issue. The GMP is based on market sentiments and keeps changing.
‘Grey market premium’ indicates investors’ readiness to pay more than the issue price.
Motisons Jewellers IPO: Should You Subscribe?
Giving a ‘Subscribe with caution’ rating to the IPO, brokerage firm Swastika Investmart in its note said, “The company is susceptible to negative publicity and seasonal demand fluctuations. Despite these considerations, the IPO’s attractive valuation of 16 times P/E offers a degree of risk mitigation. Considering Motisons’ strong brand, proven track record, and growth plans, alongside the current market sentiment.”
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It said Motisons Jewellers has a diversified product portfolio and has demonstrated a strong track record of growth. Motison’s commitment to retail network expansion and technology integration further strengthens its growth prospects. However, the highly competitive landscape and dependence on third-party suppliers present key challenges.
Another brokerage firm IndSec Research also assigned a ‘Subscribe with caution’ rating. It said Motisons has grown its revenue, Ebitda, PAT at a CAGR of 31 per cent, 26 per cent and 51 per cent, respectively over FY21-23. It has a healthy operating margin but is weak in Inventory days, working capital days and leverage ratios.
Capital Markets asked investors to avoid the IPO. It said the company is dependent on third-party suppliers and risks related to geographical concentration of operations in Jaipur.
Motisons Jewellers IPO Details
The Motisons Jewellers IPO is entirely a fresh issue of 2.74 crore equity shares with no Offer For Sale (OFS) component. The initial public offering (IPO) with a price band of Rs 52-55 a share will open on December 18 and conclude on December 20. At the upper end of the price band, the IPO will fetch Rs 151 crore.
The minimum lot size for an application is 250 shares. The minimum amount of investment required by retail investors is Rs 13,750.
Motisons Jewellers has raised a little over Rs 36 crore from anchor investors days before its maiden public issue. Motisons Jewellers has allotted 66 lakh equity shares to two funds at Rs 55 apiece — the upper end of the price band.
Meru Investment Fund PCC-Cell 1 bought 46 lakh equity shares amounting to Rs 25.3 crore, and Zinnia Global Fund PCC-Cell Dewcap Fund purchased 20 lakh shares valued at Rs 11 crore.
Together, they bought shares worth Rs 36.3 crore, data showed.
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Proceeds from the issue will be used for debt payment, funding the working capital requirement of the company and a portion will also be used for general corporate purposes.
Holani Consultants is the book-running lead manager for the issue.
