Vedant Fashions IPO: The listing of shares of Vedant Fashions, a company that sells traditional apparel from the Manyavar brand, is going to take place today. Market experts believe that the listing of shares of Vedant Fashions may remain weak. The company’s issue had received weak investor response, due to which the listing of its shares is likely to remain weak.
The IPO of Vedant Fashions was purely offer-for-sale (OFS). That is, the fund raised from the IPO will not go to the company, but all the money will go to the promoters and shareholders. Apart from this, many experts are telling the valuation of the company more, which can have an impact on the listing price. According to market experts, the shares of Vedant Fashions may get listed at the issue price or at a discount. The issue price of Vedant Fashions is Rs 866.
Vedanta Fashions is the country’s largest manufacturer of Indian vending and ethnic wear for men. Its issue opened on 4 February and closed on 8 February. The company’s issue was subscribed 2.57 times. However, retail investors did not show much interest in the IPO of Vedanta Fashions and got only 31 per cent of the bids reserved for them. On the other hand, the share reserved for Qualified Institutional Buyers (QIBs) was subscribed the most at 7.49 times, while the share of non-institutional investors (NIIs) got subscribed 1.07 times.
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Ayush Agarwal, Senior Analyst, Swastika Investmart said, “The company’s financial figures were badly affected during the corona epidemic, but it returned to normal levels again in the first half of FY 2022. Based on the earnings of FY 2021, this is The issue is valued at 161 times its P/E and 24.42 times the price to book value, which looks a bit pricey.”
Shares of Vedanta Fashions were trading near their issue price even in the gray market. “The impact of the ongoing volatility on the global level is expected to continue on the Indian stock market as well. Hence, the stock is expected to list below its issue price,” Agarwal said. Aastha Jain, Senior Research Analyst, Hem Securities, also expects the issue to be listed at a flat or a discount of a few per cent.
Vedanta Fashions has hugely popular clothing brands like ‘Manyavar’ and ‘Mohey’ which have a pan India presence. Other important brands of the company are Manthan, Tvmev and Mebaaz.