Sat Kartar Shopping Limited has emerged as a promising IPO for investors seeking exposure in the growing retail and wellness sector. With a focus on Ayurvedic solutions, the company is committed to addressing contemporary health challenges through remedies rooted in the ancient science of Ayurveda. The company's exclusive solutions are drawn from Charak Samhita, ensuring the natural and holistic approach it advocates.

IPO Details:

The Sat Kartar Shopping IPO offers a fresh issue of 41.72 lakh shares, amounting to ₹33.80 crores. The price band for the issue is set between ₹77 and ₹81 per equity share. Investors can apply for a minimum of 1,600 shares, with the lot size pegged at ₹1,29,600 for retail investors. High-net-worth individuals (HNIs) need to apply for a minimum of two lots, totaling ₹2,59,200.

Financial Performance:

The financial performance of Sat Kartar Shopping over recent years has shown promising growth. For the period ending December 15, 2024, the company's revenue stood at ₹10,95,526.38 thousand. The company's EBITDA also showed a consistent upward trend, with a notable increase from ₹26,892.55 thousand in FY22 to ₹90,521.85 thousand in FY24. Profit after tax also saw growth, further reflecting the company's solid financial footing.

Grey Market Premium (GMP):

The Grey Market Premium (GMP) for Sat Kartar Shopping is estimated at ₹40 as of the latest update, showing a significant potential for listing gains. The GMP depends on supply-demand dynamics in the grey market and serves as an indicator for the potential listing price. The IPO's pre-issue P/E ratio stands at 3.60x, with a post-issue P/E ratio of 20.23x. The industry P/E ratio, however, stands much higher at 65x, making the IPO appear attractively priced compared to industry peers.

Subscription and Allotment:

As of January 14, 2025, the Sat Kartar Shopping IPO was subscribed 316.02 times, indicating strong investor interest. The allotment process is expected to be finalized by January 15, 2025. Investors can check their allotment status by visiting the registrar’s website and submitting their application number, PAN, or DP Client ID.

Objectives of the IPO:

The company plans to utilize the net proceeds from the IPO for various strategic purposes:

1. ₹50,000 thousand for identifying acquisitions (domestic and international).
2. ₹1,10,000 thousand for marketing and advertisement.
3. ₹80,000 thousand for capital expenditures.
4. ₹50,000 thousand for investment in technology.
5. General corporate purposes.

The IPO's financial metrics highlight its potential for growth, with a pre-issue EPS of ₹22.52 and an annualized EPS of ₹6.8 for FY24. The company boasts impressive returns on capital employed (ROCE) at 91.55% and return on equity (ROE) at 66.84%, further supporting the attractiveness of the IPO.

Given the GMP and the solid financial foundation, Sat Kartar Shopping IPO is recommended for risky investors looking to capitalize on potential listing gains. The offering seems fairly priced, considering its financial performance, market potential, and the company's commitment to the wellness and Ayurvedic sectors.

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