Stove Craft IPO Updates: There has been a great response among investors regarding the IPO of Stove Craft, a company that makes kitchen appliances. The company has subscribed 7.5 times till January 8 on the last day of bidding. The IPO has so far received bids for 4.56 crore equity shares, while its issue size is 58.94 lakh equity shares. The share of retail investors has been filled up to 23 times. This IPO was opened for investment on January 25 and today i.e. January 28 is the last day of investment.
Which part is so full?
In the Stove Craft IPO, the reserve position for retail investors has been subscribed around 23 times. At the same time, the reserve portion for non-institutional investors is still 3.72 times full. While the Porson for qualified institutional buyers has been filled nearly 4.5 times so far. Stove Craft aims to raise about Rs 413 crore from its IPO. The company has set a price band of Rs 384-385 per share for the issue.
Lot size 38 shares have been kept in this IPO. That is, you have to invest for at least 38 shares. In terms of the upper price band, investors have to invest at least Rs 14630. Retail investors can apply for a maximum of 13 lots and then apply in multiples. The company has raised Rs 185 crore from 32 anchor investors.
Opinion on investment
According to brokerage house Angel Broking, the brand value, margin and returns of the company are weak compared to some peer companies. Stove craft has a higher valuation than peer companies. There is still further uncertainty regarding profits, in such a situation there is a neutral rating on the issue. Although the brokerage also says that due to cost-cutting and some other measures, the company’s margin has improved in the first half of FY 2021, but there is a concern about how sustainable it is. After COVID-19 once again when the business is normal, then the travelling cast, advertising expenses will increase again.
Where will the fund be used?
The company will use the funds raised through this IPO to liquidate the debt. The remaining funds will be spent on meeting common corporate needs. Edelweiss Financial Services and JM Financial will be the book running lead managers of the IPO. This is the fourth IPO of the year 2021. Earlier, IPOs of Indian Railways Finance Corporation (IRFC), Indigo Paints and Home First Finance Company have come.