Freshara Agro Exports Limited, an emerging player in the procurement, processing, and export of preserved Gherkins and pickled commodities from India, is set to launch its Initial Public Offering (IPO). The IPO opens for subscription from October 17, 2024, and will close on October 21, 2024. The company aims to raise ₹75.39 Crores through a Fresh Issue of 64.99 Lakh Shares, contributing to its growth strategy and sustainability initiatives.

The share price band for the Freshara Agro Exports IPO is set between ₹110 and ₹116 per equity share, with a minimum lot size of 1,200 shares. This means retail investors must invest a minimum of ₹1,39,200, while High-Net-Worth Individuals (HNIs) are required to invest in a minimum of 2 lots (2,400 shares), amounting to ₹2,78,400.

Lead Management and Market Making
GYR Capital Advisors Private Limited is the book-running lead manager for this IPO, while Purva Sharegistry (India) Private Limited will serve as the registrar. Giriraj Stock Broking Private Limited will act as the Market Maker, providing liquidity for the shares post-listing.

Grey Market Premium and Subscription Status
As of 11:30 AM on October 17, 2024, the Grey Market Premium (GMP) for Freshara Agro Exports is ₹35, reflecting positive investor sentiment based on the company's financial performance. However, investors should be cautious as the GMP is indicative of demand and supply dynamics in an unregulated environment, primarily for informational purposes.

The IPO has seen strong interest, with a live subscription status showing it subscribed 2.02 times on its first day. Investors can track the Freshara Agro Exports IPO Live Subscription Status on the NSE website.

Allotment Date and Checking Allotment Status
The allotment for the Freshara Agro Exports IPO is scheduled for October 22, 2024. Investors can check their allotment status online by navigating to the IPO allotment status page and selecting Freshara Agro Exports Limited IPO from the dropdown list. They will need to enter their application number, PAN, or DP Client ID to retrieve their status.

Use of IPO Proceeds
The proceeds from the Fresh Issue will be utilized for several purposes:

₹879.97 Lakhs for capital expenditure.

₹5,600.00 Lakhs for funding working capital requirements.

General corporate purposes.

Meeting issue-related expenses.

Financial Overview and Valuation
Freshara Agro Exports has shown consistent growth in its financial performance. For the fiscal years ending 2022 and 2023, the company reported revenues of ₹11,840.68 lakhs and ₹12,700.22 lakhs, respectively. For the period ending January 23, 2024, revenue was ₹12,476.60 lakhs, and it reported ₹7,324.98 lakhs for the period from January 24, 2024, to March 31, 2024. The company's EBITDA also increased significantly during this period.

For the IPO, Freshara Agro Exports has a pre-issue EPS of ₹12.83 and a post-issue EPS of ₹9.29. The pre-issue P/E ratio stands at 9.04x, while the post-issue P/E ratio is 12.49x, indicating that the IPO is fairly priced given the company's solid fundamentals. The ROCE for 2MFY24 is 10.04%, and the ROE is 36.96%, further supporting its financial health.

Recommendation
With a potential listing gain of 30% indicated by the Grey Market Premium, investors looking for short-term gains may find this IPO appealing. However, given the financial metrics and market conditions, we recommend only risk-tolerant investors apply for the Freshara Agro Exports Limited IPO for either listing gains or long-term investment purposes.

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