Home >Markets >Ipo >Kalyan Jewellers IPO: Grey market premium, other details in 10 points

The 1,175-crore IPO of Kalyan Jewellers India Limited opened for subscription today and the issue will close on March 18. Ahead of the IPO, Kalyan Jewellers had raised 351 crore from 15 anchor investors at the upper price band of 87 per equity share. Government of Singapore, Sundaram MF, HDFC Life Insurance Company Limited and Calypso Global Investment Fund are some of the key investors in the anchor book. The price band of the offer has been fixed at 86 to 87 per equity share.

At the end of Day 1, the issue was 0.60 times subscribed. According to grey-market tracker Abhay Doshi, Kalyan Jewellers India shares are trading at a premium of 7.

Here are 10 things to know about Kalyan Jewellers IPO:

1) Link Intime India Pvt is the registrar of the issue and according to brokerages, share allocation is likely to be finalised on March 23 and listing is likely on March 26.

2) Lot size: Bids can be made for a minimum of 172 equity shares and in multiples of 172 equity shares thereafter.

3) Half of Kalyan Jewellers IPO has been reserved for qualified institutional buyers, 35% for retail investors and 15% for non-institutional bidders.

4) The 1,175-crore initial public offer (IPO) comprises issuance of fresh equity aggregating up to 800 crore and an offer for sale (OFS) worth 375 crore.

5) Kalyan Jewellers' promoter T S Kalyanaraman will offload shares worth up to 125 crore, while Highdell Investment Ltd, an affiliate of Warburg Pincus, would sell up to 250 crore worth of shares through the OFS route.

6) Proceeds from the fresh issue of shares would be utilised for working capital requirements and general corporate purpose.

7) Axis Capital, Citigroup Global Markets India, ICICI Securities and SBI Capital Markets are the global co-ordinators and book running lead managers to the offer.

8) Kalyan Jewellers is one of the largest jewellery company in India based on revenue in FY20. It enjoys pan India presence with 107 showrooms located across 21 states and union territories in India and also have an international presence with 30 showrooms located in Middle East as on December 31, 2020.

9) Domestic brokerage Geojit has a subscribe rating on the issue, though it says the pricing is on the higher side "At the upper price band of 87, the pricing is on the higher side, but on a long-term basis, Kalyan jewellers is available at 1-year forward estimated P/E of 25x (on FY23E basis). Given forecasted improvement in profitability & balance sheet, India’s appetite for gold, strong pan India presence, brand recall and diversified product offering, we assign a “subscribe" rating on a long-term basis," the brokerage said.

10) According to the brokerage the key risks include "rich valuation versus peers may bear on short term performance, volatility in gold prices, seasonality of business and impact of government policies and high competition from both organized and unorganized players."

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