Phoenix Overseas Limited, a trading house recognized by the Ministry of Commerce, Government of India, is launching its Initial Public Offering (IPO) to raise ₹36.03 crore. The company, which operates in sectors like commodity exports, manufacturing of jute bags, and running cold storage facilities, is aiming to further expand its operations with the proceeds from the IPO.

The IPO consists of a fresh issue of 45.8 lakh shares, amounting to ₹29.31 crore, and an offer for sale of 10.5 lakh shares, valued at ₹6.72 crore. The subscription period for the Phoenix Overseas IPO will run from September 20, 2024, to September 24, 2024, with the allotment finalization date expected on September 25, 2024.

Phoenix shares will be listed on the NSE SME, with a tentative listing date of September 27, 2024. The share price band has been set between ₹61 to ₹64 per equity share, and the minimum lot size is 2,000 shares. This translates to a minimum investment of ₹128,000 for retail investors, while High-Net-Worth Individuals (HNIs) will have to invest at least ₹256,000.

KHANDWALA SECURITIES LIMITED is the book-running lead manager, while CAMEO CORPORATE SERVICES LIMITED will act as the registrar for the issue. Additionally, Nikunj Stock Brokers Limited is the sole market maker for Phoenix’s IPO.

Financial Performance and Objectives

Phoenix Overseas Limited has demonstrated steady financial growth over the last few years. The company's revenue for Fiscal Year 2024 was ₹54,915.10 lakh, up from ₹45,131.61 lakh in FY23, and ₹37,828.19 lakh in FY22. Similarly, the company's EBITDA rose from ₹956.99 lakh in FY22 to ₹1,297.17 lakh in FY24. Despite minor fluctuations, profit after tax remained strong, showing ₹538.38 lakh in FY24, compared to ₹390.52 lakh in FY22.

The proceeds from the fresh issue will be primarily allocated to:

₹1,000.00 lakh towards funding working capital requirements.

₹600.00 lakh for pursuing inorganic growth initiatives.

The remainder will go towards general corporate purposes.

These financial metrics, combined with Phoenix’s expansion plans, indicate that the IPO is reasonably priced, offering investors an attractive opportunity. The company's pre-issue EPS is ₹411.71, and the post-issue EPS is expected to be ₹2.78, with a P/E ratio of 23.02x post-issue.

Phoenix Overseas IPO GMP and Market Outlook

The Grey Market Premium (GMP) for Phoenix Overseas Limited’s IPO is currently projected in the range of ₹19 to ₹22, signaling a potential listing gain of 30%-35%. However, it's important to note that GMP fluctuations depend on demand and supply in the unregulated market, and hence, should not be solely relied upon as a predictor of future performance.

Investors should also be cautious as real market discovery will only happen once the shares are listed. The company’s strong financial performance and valuation metrics suggest that the Phoenix Overseas IPO is well-positioned for both short-term gains and long-term investment.

IPO Subscription Status

As of 12:50 PM on September 23, 2024, the Phoenix Overseas IPO had received 8.11 times subscription, with high demand from retail investors and non-institutional investors (NIIs). Given this strong initial interest, it is likely that the issue will be oversubscribed by the closing date. Investors can check the live subscription status on the NSE website for real-time updates.

How to Check Phoenix IPO Allotment Status

The allotment for Phoenix Overseas Limited IPO will be finalized on September 25, 2024. Investors can check their allotment status by following these steps:

Go to the IPO allotment status page on the registrar's website.

Select Phoenix Overseas Limited IPO from the dropdown list.

Enter your application number, PAN, or DP Client ID.

Click Submit to view your allotment status.

If you have been allotted shares, you can proceed to the next steps of finalizing your investment strategy.

Phoenix Overseas IPO Review: Should You Apply?

Phoenix Overseas Limited operates as a diversified business conglomerate with interests in commodity exports, jute bag manufacturing, and cold storage operations. The company’s leadership, headed by Aparesh Nandi, Jayanta Kumar Ghosh, and Uday Narayan Singh, brings over two decades of experience in the trading and export of agricultural commodities.

From a financial perspective, the company's robust revenue growth and increasing profitability signal a strong business model. With an ROCE of 23.88% and an ROE of 10.97% in FY24, the company has demonstrated its ability to generate value for shareholders.

For risk-tolerant investors, the Phoenix Overseas IPO presents a potential listing gain opportunity based on the strong Grey Market Premium and the company’s promising financials. Long-term investors may also consider the company’s plans for expansion, which include funding working capital and pursuing inorganic growth initiatives.

However, it's crucial to conduct a thorough analysis and consider professional advice before investing, as all investments carry risks.

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