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PremiumVishal Mega Mart IPO Day 3 Highlights: Vishal Mega Mart IPO has seen a subscription rate of 27.28 times by the third day of its offering, according to BSE data. On the third day of bidding, the IPO was primarily driven by Qualified Institutional Buyers, with Non Institutional Investors following suit. Although retail investors were fully subscribed, their participation was not exceptional.
The segment allocated for retail investors registered a subscription of 2.31 times, while the quota meant for non-institutional investors was subscribed 14.25 times. The portion reserved for qualified institutional buyers (QIBs) has been filled 80.75 times.
The initial share offering of supermarket chain Vishal Mega Mart, valued at ₹8,000 crore, achieved full subscription on the second day of bidding on Thursday, concluding with a subscription rate of 1.54 times. The segment allocated for non-institutional investors (NIIs) saw a subscription rate of 3.84 times, while Retail Individual Investors (RIIs) subscribed at 1.16 times. The portion designated for QIBs received a subscription of 48 percent.
On the first day of bidding, the subscription status for the Vishal Mega Mart IPO was at 51%, according to BSE data. Although the IPO embarked on its journey in a dynamic market, the allocation for NIIs was fully subscribed. On Tuesday, Vishal Mega Mart announced that it raised ₹2,400 crore from anchor investors.
Vishal Mega Mart IPO price band has been established between ₹74 and ₹78 per equity share. The IPO consists entirely of an offer for sale (OFS) amounting to ₹8,000 crore from Samayat Services LLP, the promoter that holds a 96.46 percent stake in Vishal Mega Mart. If the shares are priced at the upper limit of ₹78, the company is projected to have a market valuation of approximately ₹36,120 crore.
Launched in 2018, Vishal Mega Mart functions as a hypermarket chain offering a diverse array of products, including clothing, foodstuffs, electronics, and household items.
Mobikwik IPO Live: Vishal Mega Mart IPO has been subscribed 27.28 times on the third and final day as the issue received bids for 20,64,25,17,700 equity shares as against 75,67,56,757 shares on the offer, according to BSE data toll at 7:00 PM on Friday. The portion reserved for retail investors is subscribed 2.31 times, the portion reserved for Qualified Institutional Buyers (QIB) is booked 80.75 times, and the portion reserved for Non Institutional Investors (NII) is booked 14.24 times.
Vishal Mega Mart IPO booked 27.28 times so far
Gaurav Garg, Research Analyst at Lemonn Markets Desk on Vishal Mega Mart IPO:
The IPO offers an attractive valuation at 76x FY24 PE, making it relatively affordable compared to industry peers and providing a promising opportunity for retail investors. The valuation is further supported by a robust 50% CAGR growth in EPS, which enhances its appeal.
Investors interested in the retail sector are encouraged to subscribe to this IPO. Allottees can consider holding the shares for long-term gains.
The initial public offer of Vishal Mega Mart IPO has been subscribed 27.28 times on the third day of subscription today, at 17:24 IST, as per BSE data.
The initial share sale received bid for 20,64,25,23,210 shares against 75,67,56,757 shares on offer, according to BSE.
The portion for retail investors received 2.31 times subscription while the quota for non-institutional investors got subscribed 14.25 times. The qualified institutional buyers (QIBs) part is booked 80.75 times.
The initial public offer of Vishal Mega Mart IPO has been subscribed 27.26 times on the third day of subscription today, at 16:39 IST, as per BSE data.
The initial share sale received bid for 20,63,23,73,980 shares against 75,67,56,757 shares on offer, according to BSE.
The portion for retail investors received 2.29 times subscription while the quota for non-institutional investors got subscribed 14.24 times. The qualified institutional buyers (QIBs) part is booked 80.75 times.
The company is a one-stop destination serves middle and lower-middle-income consumers in India, offering a curated range of apparel, general merchandise, and FMCG products through 645 stores nationwide. The store features both own and third-party brands to meet everyday and aspirational needs. Majority of the company’s revenue comes from their own brand (70%). As of FY24, the company holds a major portion of its store in north India followed by east India and having future plans of expanding in west and south India. Over the years, the company’s top and bottom line has been steadily increasing. The companies main target is Tire-2 cities which are expected to grow its diversified retail sector at a 32% CAGR between CY23 and CY28.
The initial public offer of Vishal Mega Mart IPO has been subscribed 20.04 times on the third day of subscription today, at 15:27 IST, as per BSE data.
The initial share sale received bid for 15,16,21,40,220 shares against 75,67,56,757 shares on offer, according to BSE.
The portion for retail investors received 2.14 times subscription while the quota for non-institutional investors got subscribed 14.01 times. The qualified institutional buyers (QIBs) part is booked 55.87 times.
Vishal Mega Mart is a one-stop destination for middle- and lower-middle-income India. The company offers products across three major categories, i.e., apparel (sales mix of 45%), general merchandise (sales mix of 28%), and fast-moving consumer goods (sales mix of 27%), through a pan-India network of 645 stores.
At the upper price band of ₹78, Vishal Mega Mart is valued at FY24 P/E multiple of 76.1x on post issue capital. The company is scaling its presence across product categories and stores throughout India and has a track record of profitable growth. Its Revenue/EBITDA/PAT has grown at a CAGR of 26.3%/24.6%/50.9% respectively over FY22-24 period. The company makes relatively better EBITDA margin and similar PAT margin as compared to its major peer Dmart (Avenue Supermarts). We recommend investors to subscribe to the issue at cut-off price for long term.
The initial public offer of Vishal Mega Mart IPO has been subscribed 9.18 times on the third day of subscription today, at 14:06 IST, as per BSE data.
The initial share sale received bid for 6,95,01,59,530 shares against 75,67,56,757 shares on offer, according to BSE.
The portion for retail investors received 1.87 times subscription while the quota for non-institutional investors got subscribed 10.90 times. The qualified institutional buyers (QIBs) part is booked 20.70 times.
Tentatively, Vishal Mega Mart IPO basis of allotment of shares will be finalised on Monday, December 16, and the company will initiate refunds on Tuesday, December 17, while the shares will be credited to the demat account of allottees on the same day following refund. Vishal Mega Mart share price is likely to be listed on BSE and NSE on Wednesday, December 18.
The IPO's grey market premium (GMP) today is ₹15 per share. This indicates an expected listing price of ₹93, a premium of 19.23 percent over its issue price of ₹78. The GMP declined from ₹16 on December 12 and ₹21 on December 11.
The initial public offer of Vishal Mega Mart IPO has been subscribed 4.44 times on the third day of subscription today, at 12:40 pm. The initial share sale received bid for 318.86 crore shares against 71.79 crore shares on offer.
The portion for retail investors received 1.74 times subscription while the quota for non-institutional investors got subscribed 8.69 times. The qualified institutional buyers (QIBs) part is booked 5.97 times.
Vishal Mega Mart is ranked among the three leading offline-first diversified retailers in India, based on retail space as of March 31, 2024 (Source: RedSeer Report). The company is also the fastest-growing leading offline-first diversified retailers in India, based on profit after tax growth between FY21 and FY24, and among the two leading offline first diversified retailers in India in terms of same-store sales growth for FY24.
The initial public offer of Vishal Mega Mart IPO has been subscribed 2.37 times on the third day of subscription today, at 11:27 IST, as per BSE data.
The initial share sale received bid for 1,78,98,18,620 shares against 75,67,56,757 shares on offer, according to BSE.
The portion for retail investors received 1.50 times subscription while the quota for non-institutional investors got subscribed 6.73 times. The qualified institutional buyers (QIBs) part is booked 61%.
The e-commerce industry witnessed a phenomenal 36.8% YoY growth in terms of order volumes. As consumers prefer to shop online throughout the year, this fast-changing consumer preference towards online shopping reveals the mature status acquired by e-commerce brands in India. India’s digital economy is expected to touch US$ 800 billion by 2030, and the E-Commerce market is expected to touch US$ 350 billion in GMV by 2030.
100% FDI allowed under automatic route in B2B E-commerce and in marketplace model of e-commerce. 100% FDI under Government approval route for E-Commerce by Food Retail Companies, provided products retailed are manufactured and/or produced in India.
The company’s offline channel comprises of 645 stores across 414 cities in India, with an aggregate store area of 11.49 mn square feet, as of September 30, 2024.
The initial public offer of Vishal Mega Mart IPO has been subscribed 1.96 times on the third day of subscription today, at 10:33 IST, as per BSE data.
The initial share sale received bid for 1,48,66,09,400 shares against 75,67,56,757 shares on offer, according to BSE.
The portion for retail investors received 1.34 times subscription while the quota for non-institutional investors got subscribed 5.36 times. The qualified institutional buyers (QIBs) part is booked 51%.
The company’s loyalty program was awarded the “Best Loyalty Programme of the Year Food Retail and Non-Food Retail" at the International Loyalty Awards 2023. The Company has 133.82 million customers registered under the loyalty program as at September 30, 2024.
Kotak Mahindra Capital Company, ICICI Securities, Intensive Fiscal Services, Jefferies India, J P Morgan India, Morgan Stanley India Company are the book-running lead managers for the issue.
According to the Redseer report, India's aspirational retail market was valued at ₹68-72 trillion in 2023 and is expected to reach ₹104-112 trillion by 2028, growing at a compound annual growth rate (CAGR) of 9 percent. This shift towards organized retail is driven by increased quality expectations, a wider variety of products, improved pricing—particularly in fast-moving consumer goods (FMCG)—urbanization, and growth opportunities for organized players like Vishal Mega Mart.
Vishal Mega Mart Ltd is on the fast growing super market retail chain stores in India. Rising disposable income and a preference for quality and hygienic products amongst the population gives established companies like Vishal Mega Mart an edge over the unorganized sector as well as stiff competition to other established branded retails chains like Spencers and Reliance Smart Bazaar. Healthy financials and a debt free status gives it an impetus. We would recommend a “SUBSCRIBE" for the long term.
Vishal Mega Mart IPO 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 company depends entirely on a network of contract manufacturers to produce products for its brands. This strategy enables Vishal Mega Mart to maintain an asset-light business model, prioritizing design, branding, and retail operations while outsourcing the manufacturing process to specialized vendors.
The firm has shown strong revenue growth, driven by a focus on operational efficiency and cost management. Revenue from operations increased at a compound annual growth rate (CAGR) of 26.3%, rising from Rs. 5,589 crore in FY22 to Rs. 8,912 crore in FY24. Operating EBITDA grew at a CAGR of 24.6%, from Rs. 804 crore in FY22 to Rs. 1,249 crore in FY24. Meanwhile, Profit After Tax (PAT) surged at a CAGR of 50.9%, reaching Rs. 462 crore in FY24. Operating EBITDA margins remained around 14%, while PAT margins varied between 3.6% and 5.2% during different periods.
In terms of the valuations, on the higher price band, VMML demands P/E multiple of 69.2x post issue H1FY25 annualized EPS and EV/EBITDA multiple of 28.1x. Hence, it is recommended to “SUBSCRIBE" the issue from the long term perspective.
Vishal Mega Mart IPO GMP today is +16. This indicates Vishal Mega Mart share price was trading at a premium of ₹16 in the grey market, 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 Vishal Mega Mart share price is indicated at ₹94 apiece, which is 20.51% higher than the IPO price of ₹78.
Based on the grey market trends from the last nine sessions, today’s IPO GMP is on the rise and suggests a tepid listing. The lowest GMP recorded is ₹13, whereas the highest reaches ₹25, as noted by experts at investorgain.com.
'Grey market premium' indicates investors' readiness to pay more than the issue price.
Disclaimer: The views and recommendations above are those of individual analysts, experts and broking companies, not of Mint. We advise investors to check with certified experts before making any investment decision.
