The public is actually waiting for Baazar Style Retail Limited’s IPO, which is set to float its stocks in the share market this coming Friday, 6/09/2024. The grey market premium (GMP) indicates that the company’s shares are likely to open on the right track in both the BSE and NSE.
In the context of this research, before the listing of Baazar Style Retail, there was a premium of ₹45 on its unlisted shares, and the price-to-earnings ratio was 11.58 percent higher than the upper limit of the issue price ₹ 334. This premium, however, has come down from ₹ 65 on September 3, when the IPO closed for subscription. It is also lower than ₹126 cost witnessed on the opening day of the public issue.
If the existing grey market trends remain the same, then Baazar Style Retail shares might be listed at ₹434 (IPO price + GMP). This means that investors may be in a position to earn over 11% of the company’s share on listing.
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Swastika Investmart’s Head of Wealth Shivani Nyati shares sentiments similar to the rest regarding Baazar Style Retail going bust. On the same note, she points out aspects such as advanced growth, enhanced margins, and financial results as being on the right side. She also said that the high IPO might deter some investors because of its high value.
Nyati’s argument is to consider the big picture and how this valuation will serve the company’s growth capability minus the risks involved.
The IPO was for financial lots of ₹ 370-389 per share for a lot size of 38 shares.
It received much attention and was subscribed to 40. 66 times. The highest demand came from Qualified Institutional Buyers (QIB), with a subscription of 81. According to the rankings, institutions placed their bids 83 times, NIIs 72, and retail investors’ shares were the remaining.
Brokers such as Geojit, Deven Choksey Research, and Swastika Investment had positive comments about Baazar Style Retail. The public issue consisted of a new offer of 3,804 627 shares and a secondary offer in which promoters and investors offered 17,652 320 shares with a face value of ₹ 5 each.
Based on its RHP documents, Baazar Style Retail intends to use the proceeds to settle or pay off loans and for other purposes. The company will not receive any funds from the Offer for Sale; they’ll go to the selling shareholders.
With the listing day nearing, the focus is on Baazar Style Retail. The grey market premium indicates a promising start, and investors are optimistic about a solid return. However, it’s prudent to exercise caution and weigh the potential rewards against the associated risks.
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