Sula Vineyards IPO
The initial public offering of Sula Vineyards, the leading wine producer in India, has garnered bids for 19.23 lakh equity shares against IPO size of 1.88 crore shares, getting subscribed 10 percent on December 12, the first day of bidding.
Retail investors and high networth individuals turned active on the first day itself, buying 18 and 3 percent of their quotas respectively.
But qualified institutional buyers are yet to put in their bids for the offer. They already have invested Rs 288.10 crore in the company via the anchor book.
Half of the offer has been reserved for qualified institutional buyers, 15 percent for high networth individuals (non-institutional investors), and the remaining 35 percent for retail investors.
India’s largest wine producer and seller has reduced its offer size to 1.88 crore shares, from 2.69 crore shares especially after mobilising money via the anchor book ahead of the IPO opening.
The company plans to raise Rs 960.35 crore via the public issue which is entirely an offer for sale by promoter Rajeev Samant and investors.
Hence, the entire money, excluding issue expenses, will go to selling shareholders and the company will not receive funds from the offer.
The offer price band is Rs 340-357 per share. The last day for IPO would be December 14.
The financials of Sula Vineyards were severely impacted due to covid during FY21, but post pandemic the firm has shown strong growth on the profitability front from FY22 onwards, which the management expects to stay rangebound (due to higher premiumisation and own brands sales).
“The stock is a pure play on the wine sector, which currently sits on a low base (less than 1 percent of alcoholic beverage industry) but is expected to surpass industry growth due to higher acceptability, affordability, perceived health benefits, etc,” said ICICI Direct which assigned a rating of subscribe with a long term horizon to the IPO as the industry is currently in a nascent stage and demand centres remain concentrated mainly in a few metros.
Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.