Divine Hira Jewellers Limited, based in Zaveri Bazar, Mumbai, specializes in the design and marketing of premium 22 Karat gold jewelry. Catering to wholesalers, showrooms, and retailers, the company combines traditional artistry with modern elegance. The IPO of Divine Hira Jewellers is a Fixed Price Issue amounting to ₹ 31.84 crores, with an offering of 35.37 lakh shares at a fixed price of ₹ 90 per equity share.

The subscription period for this IPO opened on March 17, 2025, and will close on March 19, 2025. The allotment date is set for March 20, 2025, with shares expected to list on the NSE SME on or around March 24, 2025. The lot size for the IPO is 1,600 shares, and the minimum investment for retail investors is ₹ 1,44,000. For High-Net-Worth Individuals (HNIs), the minimum investment is 2 lots (3,200 shares), equating to ₹ 2,88,000.

IPO Subscription Status & Grey Market Premium (GMP)

As of March 18, 2025, the live subscription status shows that the IPO has been subscribed 1.02 times on its second day of subscription. The Grey Market Premium (GMP) is reported to be ₹ 0, which indicates no potential listing gains before the shares are listed on the exchange. This suggests that investors are cautious, and there is minimal speculative trading happening in the unorganized market.

Financial Performance & Key Metrics

Divine Hira Jewellers has demonstrated a steady financial performance over the years, with revenues for the fiscal year ending September 30, 2024, at ₹ 13,602.63 lakh. Over the past years, the EBITDA has shown a positive trajectory, reaching ₹ 407.58 lakh for the same period, and the Profit After Tax (PAT) stood at ₹ 249.83 lakh. These numbers indicate a steady growth in financial health despite the fluctuations in the jewelry market.

The pre-issue EPS for FY24 is ₹ 1.56, and the post-issue EPS will be ₹ 1.14. The P/E ratio is relatively high at 57.69x pre-issue and 79.25x post-issue, compared to the industry P/E ratio of 99x, indicating that the IPO is fairly priced.

Objectives of the IPO

The proceeds from this IPO will be utilized for the following purposes:

1. ₹ 300 Lakhs for the prepayment or repayment of certain loans availed by the company.
2. ₹ 1,900 Lakhs for funding the working capital requirements.
3. ₹ 619.09 Lakhs for general corporate purposes.

Risks & Recommendations

Given that the Grey Market Premium is flat, indicating little to no excitement among traders, and considering the high P/E ratios compared to industry norms, it appears that this IPO might not provide significant listing gains. Despite the steady growth in its financial performance, Divine Hira Jewellers Limited faces challenges in a highly competitive industry, which could affect its ability to deliver substantial returns in the short term.

Investors looking for quick listing gains may want to avoid this IPO, but those seeking to invest in a well-established gold jewelry company with steady growth may consider it for long-term potential. The steady financial metrics, along with the focus on working capital and loan repayment, could provide some stability for the company's operations post-listing.

Conclusion

The Divine Hira Jewellers IPO offers a fair valuation at ₹ 90 per share but is not expected to yield significant listing gains due to the flat GMP. The IPO is reasonably priced based on its financials and the jewelry sector's current performance. However, investors should approach this IPO cautiously, especially if looking for immediate gains. The steady performance and long-term focus on expansion and working capital make it a potentially stable investment for those with a long-term view.

The Upcoming IPOs in this week and coming weeks are Arisinfra Solutions Limited, Grand Continental Hotels, Rapid Fleet Management Services.

The Current active IPO are Paradeep Parivahan, Divine Hira Jewellers.

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