Vishal Mega Mart Limited, a leading retail chain catering to middle and lower-middle-income consumers in India, is preparing to launch its IPO to raise ₹8,000 Crores. This IPO consists entirely of an Offer for Sale (OFS) of 10,256.41 lakh shares. The IPO will open for subscription from December 11, 2024 to December 13, 2024, with a price band set at ₹74 to ₹78 per share. The listing date is tentatively set for December 18, 2024, on both BSE and NSE. The IPO's market capitalization at the upper price band will be ₹35,168.01 Crores.

Business Overview

Vishal Mega Mart is a prominent retail brand with a pan-India presence of 626 stores (as of June 30, 2024). The company serves consumers with a broad portfolio of products, including:

• Apparel
• General merchandise
• Fast-moving consumer goods (FMCG)

The company's unique selling proposition lies in offering affordable, high-quality products with a focus on variety, convenience, and accessibility. They curate a mix of own-brand and third-party products, addressing the daily needs and aspirations of their consumers.

Financial Highlights

Vishal Mega Mart has shown substantial growth in revenues, EBITDA, and profits over the past three years:

• Revenue for FY 2024: ₹89,451.27 Million
• EBITDA for FY 2024: ₹12,817.82 Million
• Profit After Tax (PAT) for FY 2024: ₹4,619.35 Million

The company’s pre-issue EPS stands at ₹1.01, while the post-issue EPS is ₹1.02. The pre-issue P/E ratio is 77.23x, and the post-issue P/E ratio is 76.13x, which is comparatively lower than the industry P/E ratio of 131x, indicating that the IPO is reasonably priced.

Grey Market Premium (GMP) and Listing Trend

The Grey Market Premium (GMP) for the Vishal Mega Mart IPO is currently ₹16, indicating a potential listing gain of 20.84%. Below is the IPO GMP trend:

• 7 December 2024: ₹16 (GMP of ₹94 expected listing price)
• 6 December 2024: ₹16 (GMP of ₹94 expected listing price)

This suggests a strong demand for the IPO, which may lead to significant listing gains upon listing.

IPO Subscription and Allotment Process

The Vishal Mega Mart IPO will open for subscription on December 11, 2024, and close on December 13, 2024. The IPO allotment date is scheduled for December 16, 2024. To check the allotment status, follow these steps:

1. Visit the IPO allotment status page.
2. Select Vishal Mega Mart Limited IPO from the dropdown.
3. Enter your application number, PAN, or DP Client ID.
4. Submit the details to view your allotment status.

Objectives of the IPO

The IPO proceeds will go entirely to the promoter selling shareholder, with no funds going to Vishal Mega Mart itself. The proceeds from the Offer for Sale will be used by the selling shareholders after deducting related expenses and taxes.

IPO Review

Vishal Mega Mart's IPO is an attractive opportunity for investors, with strong revenue growth and a reasonable valuation compared to industry peers. The company's extensive pan-India network and focus on affordable products make it a key player in the retail sector, particularly in serving middle and lower-middle-income segments.

The Upcoming IPOs in this week and coming weeks are Jungle Camps, Toss The Coin, Sai Life Sciences, Mobikwik, Vishal Mega Mart, Supreme Facility, Purple United, Yash Highvoltage, International Gemmological, Inventurus Knowledge, Rosmerta Digital and Avanse Financial.

The Current active IPO is Dhanlaxmi Corp and Emerald Tyre Manufacturers.

With the GMP indicating strong demand and the reasonable P/E ratio, investors looking for short-term listing gains may find this IPO appealing. However, the relatively lower post-issue EPS suggests that the long-term growth potential might be more limited compared to some higher-growth peers.

Given the company's solid financial performance and growth trajectory, we recommend applying for the Vishal Mega Mart IPO for listing gains, while keeping in mind the nature of the Offer for Sale structure, where proceeds are not retained by the company for expansion.

For more details on other IPOs, check out Best IPO to Apply Now - IPO List 2024, Latest IPO, Upcoming IPO, Recent IPO News, Live IPO GMP Today - Finance Saathi or visit Top News Headlines - Share Market News, Latest IPO News, Business News, Economy News- Finance Saathi.

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