3 min read.Updated: 03 Aug 2021, 12:30 PM ISTLivemint
Windlas Biotech, Devyani International, Exxaro Tiles and Krsnaa Diagnostics are set to open for subscription on Wednesday and conclude on August 6
Four issues - Windlas Biotech, Devyani International, Exxaro Tiles and Krsnaa Diagnostics, are set to open for subscription tomorrow and the three-days initial public offerings (IPOs) of the firms will conclude on August 6.
As per market observers, Windlas Biotech grey market premium (GMP) is strong at over ₹140 whereas Devyani International shares are available at a premium (GMP) of ₹62. Krsnaa Diagnostics and Exxaro Tiles are at a premium of ₹440 and ₹15 respectively in the grey market.
Devyani International: Food and beverages major and the largest franchisee of Pizza Hut, KFC, and Costa Coffee, Devyani International's issue will open for subscription next week on August 4. The issue, which will close on August 6, has has fixed the price band of its initial share sale at ₹86-90 per share, and the firm will raise about ₹1,838 crore.
''As far as the peer comparison is concerned, the post-issue FY2021 EV/Sales works out -9.9x to (at the upper end of the issue price band), which is low compared to peers (Jubilant Foodworks-15.4x, Burger King India -14.8x, Westlife Development – 10x). Further, Devyani International has a better operating margin compared to Westlife Development & Burger king. We believe this valuation is at reasonable levels. Thus, we recommend a subscribe rating on the issue,'' said Amarjeet Maurya of Angel Broking.
Prabhudas Lilladher has recommended a Subscribe rating on Devyani International IPO. It believes Devyani is on the verge of a new growth phase of the company led by KFC, Pizza Hut's growth prospects, store additions and expansion.
Windlas Biotech: The company has fixed the price band of the initial share sale at ₹448-460 per share. The IPO comprises fresh issuance of equity shares worth ₹165 crore and and an offer for sale of up to 5,142,067 equity shares.
''We believe the company is well placed to grab the opportunity arising from the industry given its strong product portfolio, relationship with its customers, R&D capabilities and efficient & quality compliant manufacturing facilities.. We have a positive view on the company from the long term perspective,'' Religare Broking said in a note.
Krsnaa Diagnostics: Diagnostics chain Krsnaa's issue price band is fixed at ₹933-954 a share. The IPO will comprise a fresh issue of ₹400 crore and an offer for sale (OFS) of up to 9.42 million shares.
''Krsnaa is well placed to benefit from growing industry trends on the back of its scale, strong brand equity, and extensive footprint across India. Further, its PPP agreements, to deploy diagnostic centres for its radiology and pathology services are typically long-term contracts that ensure visibility of revenues for its operations.. With promising industry growth prospects coupled with company’s strong execution track record, we have a positive on the company for long term,'' Religare said.
Exxaro Tiles: Another IPO to open on Wednesday, August 4 is of Exxaro Tiles, a leading manufacturer of vitrified tiles. The price band is fixed at ₹118-120 per share and the firm is is expected to raise ₹150-160 crore.
The spree of IPOs is opening up at the time when primary as well as secondary market activity is in full swing. Abhay Doshi, Founder, UnlistedArena.com, dealing in Pre-IPO & Unlisted Shares said that there could be no better time for new companies to debut on-board. ''However, if we dive deeper, we will find many IPOs looks highly priced or missing growth prospect in such times it would be prudent to choose the options wisely,'' he said.
''The sentiments of primary market are quite bullish so we will witness decent participation which in turn, may emnate listing gains. In my personal opinion, I would choose Krsnaa Diagnostics and Windlas Biotech keeping in view market momentum. Both the companies have decent top line growth but valuations looks bit on the upper side. However the recent bullish market conditions should help them on their debut,'' Doshi added.
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