BackElectronics Mart India shares make strong market debut, list at premium
Electronics Mart India IPO consisted of a fresh issue of equity shares aggregating to ₹500 crore, with no offer for sale (OFS) component
PremiumShares of Electronics Mart India Ltd made a strong stock market debut on Monday with the stock listing at ₹90 apiece on the NSE, a premium of more than 52% as compared to its IPO issue price of ₹59 per share.
The initial public offering (IPO) of consumer durables retail chain Electronics Mart India received 71.93 times subscription on the final day of offer. The IPO received bids for 449.53 crore shares against 6.25 crore shares on offer, as per exchange data.
Electronics Mart India IPO consisted of a fresh issue of equity shares aggregating to ₹500 crore, with no offer for sale (OFS) component. The price range for the offer was at ₹56-59 per share. The company said that it intends to utilise the net proceeds to fund its capital expenditure, support incremental working capital requirements and pay debt and will also be used for general corporate purposes.
“The company’s strong listing can be attributed to strong interest from investors, reasonable valuations, and a sanguine growth outlook. The company is the 4th largest consumer durable and electronics retailer in India with a leadership position in South India having the majority of its stores located in Telangana and Andhra Pradesh. The consumer durable and electronics industry in India is underpenetrated and has a long runway of growth," said Pravesh Gour, Senior Technical Analyst, Swastika Investmart.
“Nevertheless, the electronic and consumer durable market is extremely competitive and has been disrupted by e-commerce players. Further, the company faces significant competition from players like Reliance Retail, Croma, etc. Therefore, we advise investors to lock in listing gains and only aggressive investors should consider making a long-term commitment to the company. Those who applied for listing gains can maintain a stop loss of Rs.77."
Incorporated in 1980, Electronics Mart India Ltd (EMIL) was founded by Pavan Kumar Bajaj and Karan Bajaj as a proprietary concern with a consumer durables and electronics store under the name of Bajaj Electronics. As of August 31, 2022, out of 112 stores, 100 are multi brand outlets (MBOs) and 12 are exclusive brand outlets (EBOs). The company is currently associated with more than 70 electronic brands.
Its multi-brand outlets operate under the brand name Bajaj Electronics other than two specialised stores under the name 'Kitchen Stories', catering to kitchen specific-requirements and one specialised store format under the name 'Audio & Beyond', focusing on high-end home audio and home automation solutions.
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