The LGT Business Connextions Limited IPO is set to open for subscription on 19th August 2025 and will close on 21st August 2025. The IPO is a Fixed Price Issue worth ₹28.09 crore, consisting of a Fresh Issue of 23.62 lakh shares aggregating ₹25.28 crore and an Offer for Sale (OFS) of 2.62 lakh shares worth ₹2.81 crore. Post issue, the company is expected to be listed on the BSE SME platform with a tentative listing date of 26th August 2025.

The IPO price has been fixed at ₹107 per equity share, which values the company at a market capitalisation of ₹100.29 crore at the issue price. The lot size is 1,200 shares, and retail investors need to apply for at least two lots (2,400 shares) amounting to a minimum investment of ₹2,56,800.

The lead manager for the issue is Mark Corporate Advisors Private Limited, while Skyline Financial Services Private Limited is the registrar. Asnani Stock Brokers Private Limited will act as the market maker.

Company Background

Founded in 2016, LGT Business Connextions Ltd operates through its travel and tours brand LGT Holidays, offering services across the tourism industry. The company was established with a vision to reshape travel trends and deliver memorable travel experiences. The founders, Mr. Wilfred Selvaraj and Mrs. Padma Wilfred, bring decades of experience, with Mr. Selvaraj having over 30 years in the travel segment and Mrs. Padma Wilfred having around a decade of experience in the real estate sector.

The company has shown consistent financial growth over the last three years. Its revenues increased from ₹6,117.62 lakh in FY23 to ₹8,953.07 lakh in FY24, and further to ₹10,080.94 lakh in FY25. Similarly, EBITDA rose from ₹450.01 lakh in FY23 to ₹570.72 lakh in FY24 and ₹844.76 lakh in FY25. Profit after Tax (PAT) also grew from ₹297.43 lakh in FY23 to ₹363.17 lakh in FY24 and ₹521.59 lakh in FY25.

Valuation and Financial Metrics

The company’s pre-issue EPS stands at ₹7.44, which will dilute to ₹5.56 post-issue. Its P/E ratio comes to 14.38x pre-issue and 19.23x post-issue, while the industry P/E ratio is around 34x. The ROCE for FY24 is 45.19%, and the ROE stands at 41.89%, indicating strong return metrics.

Despite these positives, the IPO is seen as fairly priced rather than attractively priced, especially considering the size and scale of operations.

IPO Grey Market Premium (GMP)

The Grey Market Premium (GMP) of the LGT Business Connextions IPO currently stands at ₹0, suggesting no expected listing gains. Analysts highlight that GMP is unreliable and unregulated, but it often serves as an indicator of investor sentiment before listing. In this case, the lack of premium shows limited enthusiasm from investors.

Use of Proceeds

The company plans to use the IPO proceeds for:

1. ₹1,043.61 lakh for capital expenditure.

2. ₹770 lakh for working capital requirements.

3. ₹378.88 lakh for general corporate purposes.

Risks and Concerns

While the company has posted steady growth, there are risks that investors should carefully evaluate:

• Dependence on promoters’ experience with limited institutional management.

• Exposure to the volatile tourism industry, which is affected by global and domestic factors such as economic cycles, pandemics, and geopolitical tensions.

• The IPO valuations appear stretched, given its post-issue P/E of 19.23x, which may not leave much room for listing gains.

Should You Invest?

Analysts suggest that while LGT Business Connextions Ltd has shown robust financial growth and strong return ratios, the lack of Grey Market Premium and the relatively high valuations mean that the IPO may not provide significant listing gains. For long-term investors, the strong fundamentals and expansion plans in the tourism industry could make it an opportunity worth considering. However, for those seeking short-term listing gains, experts recommend a cautious approach or even an “Avoid” rating.

The Upcoming IPOs in this week and coming weeks are Mangal Electrical Industries, LGT Business Connextions, Vikram Solar, Gem Aromatics, Studio LSD, Shreeji Shipping Global, Patel Retail.

The Current active IPO are Regaal Resources, Mahendra Realtors and Infrastructure.

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

Join our Trading with CA Abhay Telegram Channel for regular Stock Market Trading and Investment Calls by CA Abhay Varn - SEBI Registered Research Analyst.