Senco Gold, a renowned jewelry maker, witnessed a subscription of 69% on the first day of its initial public offering (IPO). The IPO attracted bids for 65,28,018 shares against the total of 94,18,603 shares on offer. The retail portion of the IPO was fully subscribed, reaching 1.12 times. The High Net Worth Individual (HNI) and Non-Institutional Investor (NII) portion saw a subscription of 62%, with the Rs 2-10 lakh category receiving bids 1.23 times, while the Rs 10 lakh-plus category received 32% subscription.
The strong response from retail investors indicates their confidence in Senco Gold and its growth prospects. The company’s IPO has generated significant interest among investors, who recognize the potential value and opportunities presented by the jewelry sector. The subscription figures reflect the positive sentiment surrounding the IPO and the demand for Senco Gold’s shares.
In the grey market, the premium for unlisted shares of Senco Gold stood at Rs 124, representing an increase from the previous session’s level of Rs 122. The Grey Market Premium (GMP) serves as an indicator of market sentiment and investor expectations regarding the future performance of the company. The rising GMP suggests growing optimism among investors, further bolstering the appeal of the IPO.
The Senco Gold IPO comprises fresh equity shares worth up to Rs 270 crore and an offer-for-sale (OFS) of Rs 135 crore shares. The IPO is being offered in the price band of Rs 301-317 per share. Retail investors interested in subscribing to the issue are required to bid for at least one lot, which consists of 47 equity shares.
Reliance Securities, a prominent brokerage firm, analyzed the IPO and found it to be reasonably valued. On a fiscal year 2023 basis, the IPO was valued at 15.5 times earnings per share, 10.1 times enterprise value/earnings before interest, taxes, depreciation, and amortization (EV/EBITDA), and 0.8 times enterprise value/sales (EV/Sales). These valuation metrics indicate a reasonable pricing strategy, according to Reliance Securities. However, the brokerage also pointed out that Senco Gold’s higher concentration in the Eastern region poses a challenge, as it makes the company more susceptible to regional market dynamics.
Senco Gold’s financial performance has shown improvement over the past two years, and the company has established a strong reputation in the jewelry industry. With its rich heritage, exquisite craftsmanship, and a wide range of products, Senco Gold has built a loyal customer base. The IPO will provide the company with the necessary capital to fuel its growth plans and expand its presence in new markets.
The Senco Gold IPO will remain open for subscription until Thursday, July 6. Market participants will closely monitor the subscription levels in the coming days to gauge investor sentiment and the overall success of the IPO. The funds raised through the IPO will be utilized to strengthen Senco Gold’s business operations, enhance its product portfolio, and support future expansion initiatives.
In conclusion, Senco Gold’s IPO has received a strong response from investors, with a subscription of 69% on the first day. The fully subscribed retail portion and the rising GMP indicate the market’s confidence in the company’s growth potential. As the IPO progresses, Senco Gold aims to leverage the capital raised to capitalize on market opportunities and further establish its position as a leading jewelry brand in India.
