Stove Kraft IPO received 1.4x subscription on the second day. The retail investor category oversubscribing by 8.9 times.
It is the fourth IPO to open this month. If you haven’t applied for the IPO yet, here are the key highlights of the offer.
- Stove Kraft IPO issue opened on January 25, 2021. The three-day initial public offering issue will remain open until January 28, 2021
- The IPO shares, issued in the price band of Rs 384-385, expected to fetch Rs 412.63 crores in the upper price band
- The issue size contains 82.50 lakh OFS shares worth Rs 317.6-crores and the total value of the fresh scrips is Rs 95 crore
- Ahead of the IPO, the company raised Rs 185 crores from thirty-two anchor investors, selling shares at Rs 385 apiece
- Retail individual investors need to apply for at least 38 shares and increase their bidding size by up to 13 lots or 494 shares worth 190,190
- The company has appointed Edelweiss Financial Services Ltd and JM Financial Consultants Private Limited as their book-running managers
- KFintech Private Limited is the registrar of the offer
Stove Kraft is a leading name in manufacturing kitchen appliances in value, semi-value, and premium categories under its distinguished brands Pigeon and Gilma. SKL said it has also received a green signal to start manufacturing under the US kitchen appliance brand Black+Decker.
In manufacturing plants located in Bengaluru and Beddi, the company produces over 660 products in cookware, cooking appliances, household utilities, and more.
In H1 of FY 21, the company increased its revenue and PTA. During FY 20, SKL’s profit rose by 3.2 crores from 0.7 crores in FY 19 and a loss of Rs 12 crores the year before. Between this period, its revenue registered a growth rate of 13 percent CAGR. It implies that the company has grown steadily over the years, maintaining a healthy profit margin. However, SKL also reported a low EBITDA margin during this period between 2-5.
The EBITDA margin is the reflection of a company’s operating profit, excluding external effects. Usually, a healthy EBITDA margin implies a company’s ability to put working capital into use. So, investors also check the EBITDA margin to compare between companies while investing beside other financial metrics. Although SKL registered a growth in its EBITDA margin during H1 of FY 21, the ratio was low during FY20 from its competitors TTK Prestige and Hawkins Cookers, 12 and 15 percent.
Stove Kraft IPO received 0.07 and 8.9 times subscription in high net worth individual and retail investors categories.
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