The Kabra Jewels IPO is making waves in the market with its fresh issue of 31.25 lakh shares, aimed at raising ₹40.00 crores. The company, a prominent player in the retail jewellery industry, specializes in offering a diverse range of gold, diamond, and silver ornaments, along with coins, utensils, and artifacts. Their exclusive creations are marketed under the brand name KK Jewels. With a price band set between ₹121 and ₹128, the IPO has gained significant attention as it offers a promising investment opportunity, especially given its strong financial performance.

Kabra Jewels IPO Subscription Status

As of January 16, 2025, the Kabra Jewels IPO has been subscribed 16.15 times on its second day, showing significant investor interest. This high subscription indicates that the market views Kabra Jewels favorably, particularly given the company's steady financial growth over the years. The IPO is expected to be allotted by January 20, 2025, and listed on the NSE SME on January 22, 2025.

Grey Market Premium (GMP) Trends

The Grey Market Premium (GMP) for the Kabra Jewels IPO is currently ₹50, which suggests a listing gain of 39.06% based on the current financial performance of the company. While GMP provides a rough indication of how shares might perform post-listing, it's important to note that GMP trading is unregulated. Therefore, real price discovery happens only post-listing on the stock exchange. However, the GMP figures indicate strong market sentiment towards Kabra Jewels and its IPO offering.

Financial Performance Highlights

Kabra Jewels has demonstrated consistent growth in its financials. For the period ended November 30, 2024, the company reported revenues of ₹12,584.47 lakh and an EBITDA of ₹2,021.11 lakh. The profit after tax (PAT) for FY 2024 stood at ₹880.89 lakh, reflecting a solid profit margin and growth over previous years. Kabra Jewels' EPS (Earnings per Share) is expected to be ₹12.77 pre-issue and ₹8.96 post-issue. The P/E ratio for the company is currently 10.02x, which is relatively low compared to the industry average of 37x, indicating potential for price appreciation in the future. Additionally, the company’s Return on Capital Employed (ROCE) is at 18.23%, while the Return on Equity (ROE) stands at 30.25%, showcasing strong financial health.

Objectives of the IPO

Kabra Jewels intends to use the net proceeds from the IPO for the following purposes:

1. Repayment of borrowings: ₹10 crores to reduce debt.
2. Working Capital: ₹22 crores to strengthen operations.
3. General Corporate Purposes: Strengthening the overall financial position and operational capacity.

Kabra Jewels IPO Allotment & Listing Information

The allotment for the Kabra Jewels IPO is expected to be finalized on January 20, 2025, with the shares listed on the stock exchange on January 22, 2025. Investors can check their allotment status online by visiting the registrar’s website, Cameo Corporate Services Limited. The lot size for retail investors is 1,000 shares, requiring a minimum investment of ₹1,28,000, while HNIs need to apply for at least two lots, which amount to ₹2,56,000.

Final Investment Strategy

Given the strong financials and favorable market conditions, the Kabra Jewels IPO is a promising opportunity for investors seeking listing gains. Retail investors should be cautious about the volatile nature of the market, but for those with a higher risk appetite, the potential for gains from the Grey Market Premium and solid earnings performance makes it an attractive choice.

The Upcoming IPOs in this week and coming weeks are  EMA Partners, and Capital Numbers.

The Current active IPO are  Stallion India, Land Immigration, Kabra Jewels and Rikhav Securities.

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