The Leo Dry Fruits and Spices Trading Limited IPO is an exciting opportunity for retail and high-net-worth investors. The company, known for its diverse range of spices, dry fruits, and grocery products under the brand names “VANDU” and “FRYD,” is looking to raise ₹25.12 Crores through a fresh issue of 48.30 Lakh shares. The IPO price is set between ₹51 and ₹52 per share, with a market capitalization of ₹93.03 Crores at the upper price band.

IPO Details and Key Offerings

The IPO opens for subscription from January 01, 2025, and closes on January 03, 2025. With a lot size of 2,000 shares, retail investors must invest a minimum of ₹1,04,000. High-net-worth individuals (HNIs) are required to apply for a minimum of two lots, which amounts to ₹2,08,000. The IPO GMP (Grey Market Premium) as of January 2, 2025, was ₹10, indicating potential listing gains of 19.23%. However, potential investors should be cautious about the non-regulated grey market trading, which does not guarantee real price discovery.

Company Overview and Financial Performance

Leo Dry Fruits and Spices Trading has consistently expanded its portfolio across spices, dry fruits, ghee, seasonings, and frozen products. The company is led by experienced promoters, including Mr. Kaushik Sobhagchand Shah and Mr. Ketan Sobhagchand Shah, who bring years of expertise in the dry fruit and spices trading industry.

For the financial year ending September 30, 2024, Leo Dry Fruits reported ₹1,788.24 Lakh in revenues, marking a steady increase from previous years. The EBITDA of ₹353.88 Lakh reflects a significant improvement compared to previous years. Notably, the company's Profit After Tax has grown to ₹187.18 Lakh for the period ending September 30, 2024. This steady growth underscores the potential for long-term stability in the market.

Grey Market Premium Analysis

As of January 2, 2025, the Grey Market Premium (GMP) for Leo Dry Fruits and Spices Trading IPO was ₹10, reflecting 19.23% potential gains for investors. The GMP indicates the price at which shares are expected to trade before listing. While this is based on unregulated market forces, it gives an early signal of demand and supply dynamics. Investors should remember that GMP is not a reliable predictor of actual market performance and can fluctuate based on factors such as overall market conditions and investor sentiment.

Live Subscription Status

The subscription status for the Leo Dry Fruits IPO, as of January 3, 2025, indicates that the IPO has been subscribed 169.08 times, which reflects strong interest from investors. This high subscription rate is a positive sign for potential listing gains, as it suggests robust demand for shares in the primary market.

IPO Allotment Process

The allotment for the Leo Dry Fruits and Spices Trading IPO will be finalized on January 06, 2025, with the results available on the registrar’s website. Investors can check the allotment status by entering their application number, PAN, or DP Client ID on the official site. Once allotted, shares are expected to list on the BSE SME on January 8, 2025.

Investment Strategy

Given the solid financial performance and experienced leadership of Leo Dry Fruits, the IPO valuation appears attractive with a P/E ratio of 9.98x on a pre-issue basis, which is well below the industry average of 71x. However, with the post-issue P/E ratio increasing to 14.02x, investors need to weigh the potential risks associated with the current market conditions.

Objective of the IPO Proceeds

The company plans to utilize the net proceeds of the IPO for several key objectives, including:

1. ₹1,500.00 Lakh for working capital requirements, ensuring smoother operations.
2. ₹425.00 Lakh for marketing, branding, and advertising efforts to expand the reach of their brands.
3. General corporate purposes to facilitate growth and scalability in future operations.

Recommendation and Conclusion

Based on the financial performance and IPO pricing, the Leo Dry Fruits and Spices Trading IPO appears to be a reasonably priced offering, with good potential for long-term growth. However, considering the grey market premium trends and current market volatility, investors should carefully evaluate their risk tolerance before applying. Given the steady financial growth, attractive valuation relative to industry peers, and the company’s commitment to expanding its product portfolio, investors seeking exposure to the FMCG sector may find this IPO appealing.

The Upcoming IPOs in this week and coming weeks are Indobell Insulation, Standard Glass Lining, Quadrant Future, Capital Infra Trust, Delta Autocorp, Avax Apparels and B R Goyal.

The Current active IPO are   Fabtech Technologies, Davin Sons and Parmeshwar Metal.

For more updates on executive appointments and other business developments, we encourage readers to explore related news and articles, including the latest on IPOs, share market updates, and financial strategies at:
Best IPO to Apply Now - IPO List 2024, Latest IPO, Upcoming IPO, Recent IPO News, Live IPO GMP Today - Finance Saathi
Top News Headlines - Share Market News, Latest IPO News, Business News, Economy News- Finance Saathi.

Join our Trading with CA Abhay Telegram Channel for regular Stock Market Trading and Investment Calls by CA Abhay Varn - SEBI Registered Research Analyst & Finance Saathi Telegram Channel for Regular Share Market, News & IPO Updates.

Start your Stock Market Journey and Apply in IPO by Opening Free Demat Account in Choice Broking FinX.