Orkla India IPO Day 1 Highlights: Issue booked 79% so far.Check GMP, review, key dates, issue details. Should you apply?

Orkla India IPO subscription status was 79% on day 1. The retail portion was subscribed 90%, and NII portion has been booked 1.53x, Qualified Institutional Buyers (QIBs) portion received 2% bids. Employee portion subscribed 3.27 times.

The company has received bids for 1,25,61,640 shares against 1,59,99,104 shares on offer, at 17:00 IST, according to data on BSE.

“At the upper price band of ₹730, Orkla is available at a P/E of 31.7x (FY26E annualised), which appears fairly priced compared to its peers. Orkla India is poised for long-term growth, backed by a strong balance sheet, steady cash flows, supportive policy tailwinds, focus on regional brands, product innovation, robust distribution network and early signs of demand recovery— especially as GST cuts and rising consumer sentiment boost its core food categories. Hence, we assign a SUBSCRIBE rating for investors with a long-term investment horizon,” said Geojit Research.

The company enjoys a Pan-India market share of 18.6% in the ready-to-eat/ready-to-cook convenience foods segment.

The company’s return on capital employed improved significantly from 20.7% in FY24 to 32.7% in FY25, driven by enhanced profitability and capital efficiency. It maintains a debt-free balance sheet since FY24, demonstrating prudent financial management and a strong foundation for future growth.

The company boasts of two of the most popular food brands in the South Indian markets – MTR and Eastern. Orkla has built a significant market share in the packaged spices market highlighting strong brand equity and deeper understanding of consumer preferences and taste. The company commands market leadership in Karnataka and Kerala with market share of 31% and 42% respectively in the packaged spices market as of FY24.

"Orkla India Ltd, the maker of MTR and Eastern foods, brings a solid brand portfolio, debt free financials, extensive distribution network, and global presence position it well for future growth. The company is expected to benefit from recent GST cuts, which should support margin improvement in the near term.

However, the company faces risks from geographic concentration in South India, raw material price volatility, and also revenue growth has been modest at around 3% in FY25. While near-term listing gains appear likely given positive market sentiment and brand equity, sustaining valuations over the long-term would require stronger growth visibility and national scale-up. Hence, we rate the issue Neutral, suggesting participation only for short-term opportunities or post-listing entry on correction," said Centrum Broking.

The company operates nine modern manufacturing units in India with a total installed capacity of 182,270 TPA as of Jun-25. Its facilities, including IoT-enabled and automated plants in Bommasandra, Bengaluru, ensure high efficiency, productivity, and quality. The company follows a hybrid manufacturing strategy, combining in-house and contract manufacturing to optimise costs, flexibility, and time to market while protecting proprietary recipes.

Export sales are a key focus area for the company, supported by a strong global distribution network. As of Jun-25, the company exported its products to 45 countries, including through deemed exports, with established partnerships across the GCC, the US, Canada, Australia, and New Zealand. With the rising global popularity of South Indian cuisine, its diverse product portfolio, including MTR’s vegetarian range and Eastern’s non-vegetarian offerings, enables the company to serve both plant-based and wider consumer segments, strengthening its global competitiveness and reach.

The company is led by an experienced and long-tenured management team overseeing a workforce of 2,586 employees as of June 30, 2025. Under the leadership of Sanjay Sharma, Managing Director and CEO, with over 32 years of industry experience, the team includes seasoned professionals heading key functions such as finance, operations, strategy, human resources, and major business units, ensuring strong governance and sustainable growth.

With a portfolio of 400 products across categories, the company sells an average of 2.3 million units per day, while its flagship Eastern brand has remained India’s largest exporter of branded spices for 24 consecutive years.

1. Supply chain disruption: Availability of raw materials for spices and masalas are subject to price fluctuations due to weather, supply-demand shifts and logistics. Any adverse impact in the supply chain may impact operations.
2. Operational risk: Any contamination or spoilage of raw materials could damage brand reputation or attract regulatory action leading to disruption in the company’s operations.

“Over the last three years, OIL has delivered Sales/EBITDA/PBT CAGR of 5.0%/12.9%/22.9% respectively while adj. PAT has declined from ₹338 crore in FY23 to ₹289 crore in FY25 due to tax reversal in FY23. It is a virtually debt free company, makes healthy return ratios & margins and generates stable cash flows of ₹300-400 crore annually. At the upper price band of ₹730, OIL is valued at FY25 PE of 34.6x on post issue capital. Looking at the historical growth track record of the company, the issue looks fairly valued. Hence, we maintain NEUTRAL view on the issue and would like to monitor the performance of the company post listing,” said SBI Securities in its report.

The company boasts of two of the most popular food brands in the South Indian markets – MTR and Eastern. Orkla has built a significant market share in the packaged spices market highlighting strong brand equity and deeper understanding of consumer preferences and taste. The company commands market leadership in Karnataka and Kerala with market share of 31% and 42% respectively in the packaged spices market as of FY24.

Orkla has a diversified product portfolio spanning across categories such as spices, masalas, ready-to-eat and ready-to-cook meals, sweets and beverages. The company has also ventured into new cuisine spaces such as Pan-Asian cuisine with a range of blended spices and cooking pastes under its new brand ‘Wok N Roll’.

The company has an extensive pan-India distribution network with 834 distributors and 1,888 sub-distributors across 28 states and 6 union territories, 42 modern trade partners and 6 e-commerce and quick commerce partners.

1. Drive household penetration and usage of products in core markets.
2. Expand presence in international markets particularly among the Indian diaspora.
3. Expand product portfolio to strengthen and extend the core offerings.
4. Drive operational efficiencies to improve margins and cash conversion.
5. Strategically acquire leading brands and businesses to expand into newer geographies and adjacent product offerings.

The company is backed by Orkla ASA (Norway) – a FMCG and branded consumer goods major operating in 100+ countries. Orkla ASA entered the Indian FMCG market with the acquisition of MTR in 2007 and later acquired Eastern brand in 2021. Orkla ASA’s parentage provides with on-demand access to Orkla ASA’s Global Centres of Excellence, including in domains such as food safety and quality, sustainability, marketing and innovation, information technology, sales, procurement.

"On valuation parse at the upper price band of ₹730/-, the issue is asking for a market cap of ₹10,000 crore. Based on FY 2026 annualised earnings and fully diluted post- IPO paid up capital, the company is asking for a PE of 31.7x, which appears reasonable given its market leadership, strong brands, and entrenched regional dominance in the spices and convenience foods space.

However, investors should note that the IPO comprises a 100% Offer for Sale (OFS) of Rs. 1,667 cr, which could be viewed as a key concern for new investors. With a widespread distribution network of 834 distributors and exports to 45 countries, Orkla India demonstrates strong domestic and global reach. We believe Orkla India is well placed in India’s fast-growing packaged food sector. Hence, we recommend investors to “SUBSCRIBE” the Orkla India Ltd IPO for long term perspective," said Rajan Shinde, Research Analyst at Mehta Equities Ltd.

ICICI Securities, Citigroup Global Markets India, JP Morgan India, and Kotak Mahindra Capital Company serve as the lead managers for the book-running of the issue. Kfin Technologies is the registrar of the issue.

As outlined in the red herring prospectus (RHP), the company's only competitor is Tata Consumer Products Ltd, which has a price-to-earnings (PE) ratio of 90.1.

The firm's initial public offering (IPO) consists entirely of an Offer For Sale (OFS) of 2.28 crore equity shares by the promoters and other shareholders, without any fresh equity being issued.

As part of the OFS, promoter Orkla Asia Pacific Pte, along with shareholders Navas Meeran and Feroz Meeran, are selling their shares.

Currently, the promoters, Orkla Asia Pacific Pte Ltd and Norwegian industrial investment company Orkla ASA, possess a 90% stake, while Navas Meeran and Feroz Meeran each hold a 5% stake in the business.

The issue has reserved not more than 50% of the shares in the public issue for qualified institutional buyers (QIB), not less than 15% for non-institutional Institutional Investors (NII), and not less than 35% of the offer is reserved for retail investors. The employee portion has been reserved up to 30,000 equity shares.

Tentatively, Orkla India IPO basis of allotment of shares will be finalised on Monday, November 3, and the company will initiate refunds on Tuesday, November 4, while the shares will be credited to the demat account of allottees on the same day following refund. Orkla India share price is likely to be listed on BSE and NSE on Thursday, November 6.

Orkla India announced on Tuesday that it has secured approximately ₹500 crore from anchor investors, just one day prior to its initial public offering opening for subscriptions. The allocation included a robust combination of top domestic and international institutional investors.

Notable participants included Nippon India Mutual Fund, Aditya Birla Sun Life Mutual Fund, LIC Mutual Fund, Baroda BNP Paribas Mutual Fund, Nomura Funds Ireland, Government Pension Fund Global, Jupiter India Fund, and Pinebridge India Equity Fund, as detailed in a circular published on the BSE website.

According to the circular, Orkla India allocated a total of 68,43,900 equity shares to anchor investors at a price of ₹730 each, raising ₹499.6 crore through the anchor book.

Orkla India IPO GMP is ₹77. This indicates Orkla India share price were trading at a premium of ₹77 in the grey market on Wednesday, according to investorgain.com.

Considering the upper end of the IPO price band and the current premium in the grey market, the estimated listing price of Orkla India share price was indicated at ₹807 apiece, which is 10.55% higher than the IPO price of ₹730.

Grey market activity during the last six sessions indicates that today's IPO GMP is down and is likely to continue to decline. Experts say that the lowest GMP is ₹77.00 and the highest is ₹145.

'Grey market premium' indicates investors' readiness to pay more than the issue price.

Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before taking any investment decisions.