The Cello World initial public offering (IPO) has officially opened for subscription on October 30, 2023, and will remain accessible to investors until November 1, 2023. In this article, we will delve into the critical aspects of this IPO, including the share price, Grey Market Premium (GMP), and whether it’s a worthwhile investment.
Cello World IPO Details
Cello World has set the IPO price band at a range of Rs 617 to Rs 648 per equity share, each with a face value of Rs 5. This offering is slated to be listed on both the National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE).
Understanding the Offer
This IPO consists of a full offer for sale (OFS), where promoters and other shareholders will divest shares with a face value of Rs 5, totaling an impressive Rs 1,900 crore. Additionally, there is an allocation of up to Rs 10 crore reserved for eligible employee subscriptions.
Here’s a breakdown of the upcoming share offerings by the promoters:
- Pradeep Ghisulal Rathod: Rs 300 crore
- Pankaj Ghisulal Rathod: Rs 736 crore
- Gaurav Pradeep Rathod: Rs 464 crore
- Sangeeta Pradeep Rathod: Rs 200 crore
- Babita Pankaj Rathod: Rs 100 crore
- Ruchi Gaurav Rathod: Rs 100 crore
It’s important to note that the company itself will not receive any proceeds from this offer. Instead, all Offer Proceeds (net of any Offer-related expenses borne by the Selling Shareholders) will go directly to the respective selling shareholders, in proportion to the equity shares they’ve offered in the OFS.
Key Players in the IPO
The Cello World IPO is managed by renowned financial institutions, with Kotak Mahindra Capital Co. Ltd, ICICI Securities Ltd, IIFL Securities Ltd, JM Financial Ltd, and Motilal Oswal Investment Advisors Ltd serving as book running lead managers. Additionally, Link Intime India Pvt. Ltd is the registrar.
Financial Performance
In the fiscal year 2023, Cello World witnessed an impressive year-on-year surge of approximately 32% in consolidated revenue from operations, reaching Rs 1,796.69 crore. The net profit also exhibited substantial growth, increasing by 29.86% and reaching Rs 285 crore.
Cello World IPO GMP
The Grey Market Premium (GMP) for Cello World Ltd shares is currently quoted at a premium of Rs 90. This indicates strong investor interest in the IPO.
Last week, shares of this renowned pen maker were trading at a premium of Rs 95 in the grey market. Considering the upper end of the IPO price range and the current GMP, the projected listing price for Cello World shares is approximately Rs 743 per share. This represents a significant 14.66% increase over the IPO price of Rs 648.
Subscription Status
As of 11:15 AM on the first day of bidding, the Cello World IPO has received a subscription of 0.05 times, with the retail portion being subscribed 0.08 times. Meanwhile, the NII (Non-Institutional Investor) portion has garnered a subscription of 0.06 times during this period.
Expert Recommendations
Reliance Securities has given a ‘subscribe’ rating to the Cello World IPO, highlighting the company’s strong manufacturing and production capabilities, continuous product innovation, and effective brand identity. They believe that Cello World is poised to be a prominent player in its respective business verticals and recommend subscribing to the issue.
In Conclusion
The Cello World IPO is generating significant interest among investors, with a competitive share price, a healthy GMP, and expert recommendations. However, as with any investment decision, it’s crucial to conduct thorough research and consider your financial goals before making a choice. Investing in an IPO requires a clear understanding of the company’s fundamentals and long-term potential, so make sure to make an informed decision that aligns with your investment strategy.