Phoenix Overseas Limited, a diversified trading house recognized by the Ministry of Commerce, Government of India, is set to launch its Initial Public Offering (IPO) on September 19, 2024. The IPO, targeting a raise of ₹36.03 Crores, will consist of a fresh issue of 45.8 lakh shares valued at ₹29.31 Crores and an offer for sale of 10.5 lakh shares amounting to ₹6.72 Crores.

Company Overview

Phoenix Overseas Limited operates across multiple sectors, including the export of commodities, manufacturing/exporting jute bags (visit their website at www.bagsindia.com), handicrafts, and maintaining multipurpose cold storage facilities. The company's collaborative growth strategy has established it as a prominent player in the industry.

IPO Details:

IPO Size: ₹36.03 Crores

Shares Offered: 45.8 lakh shares (Fresh Issue) and 10.5 lakh shares (Offer for Sale)

Price Band: ₹61 to ₹64 per equity share

Lot Size: 2,000 shares

Minimum Investment for Retail Investors: ₹128,000

Minimum Investment for HNIs: 2 lots (4,000 shares), totaling ₹256,000

KHANDWALA SECURITIES LIMITED is the book-running lead manager, CAMEO CORPORATE SERVICES LIMITED is the registrar, and Nikunj Stock Brokers Limited is the sole market maker for the IPO.

Grey Market Premium (GMP) and Subscription

The Grey Market Premium (GMP) for the Phoenix Overseas IPO is expected to range between ₹19 to ₹22. This indicates potential listing gains of approximately 30-35%. The premium is a speculative indicator and does not guarantee actual market performance.

The subscription period begins on September 19, 2024. Investors can expect high interest given the company’s diverse operations and growth initiatives. However, the actual subscription status will be updated in real-time as the IPO progresses.

Financial Performance

Phoenix Overseas Limited has demonstrated robust financial performance in recent fiscal years. The company's revenue grew from ₹37,828.19 lakhs in FY22 to ₹54,915.10 lakhs in FY24. EBITDA also increased from ₹956.99 lakhs in FY22 to ₹1,297.17 lakhs in FY24, reflecting a solid operational performance. Profit After Tax (PAT) grew from ₹390.52 lakhs in FY22 to ₹538.38 lakhs in FY24.

Key Financial Metrics:

Revenue: ₹54,915.10 lakhs in FY24

EBITDA: ₹1,297.17 lakhs in FY24

PAT (Profit After Tax): ₹538.38 lakhs in FY24

Pre-issue EPS: ₹411.71

Post-issue EPS: ₹2.78

Pre-issue P/E ratio: 5.46x

Post-issue P/E ratio: 23.02x

ROCE (Return on Capital Employed): 23.88% for FY24

ROE (Return on Equity): 10.97% for FY24

The company’s financial stability, combined with its expected listing gains, suggests that the IPO is priced fairly.

Objectives of the IPO

The proceeds from the IPO will be used for the following purposes:

Funding Working Capital: ₹1,000.00 lakhs will be allocated to enhance working capital requirements, supporting the company's operational needs and growth.

Inorganic Growth Initiatives: ₹600.00 lakhs will be used to pursue growth opportunities and strategic acquisitions, expanding the company's market presence.

General Corporate Purposes: Additional funds will be used for various corporate activities and operational expenses.

IPO Allotment and Listing

The allotment of shares is scheduled for September 24, 2024. Investors can check their allotment status by following these steps:

Visit 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.

Submit the details to view your allotment status.

Review and Recommendations

The Phoenix Overseas IPO is priced within the range of ₹61-64 per share, with anticipated listing gains of 30-35%. Given the company's strong financial performance and the strategic use of IPO proceeds, the stock appears to be a viable investment for those looking for growth opportunities. However, investors should consider their risk appetite and seek professional advice before investing.

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