DOMS Industries IPO fully subscribed within first hour of opening after strong retail investor participation

DOMS IPO, which opened for subscription on Wednesday, was fully subscribed within just one hour, primarily driven by strong participation from retail investors.

As of 11:50 am, the public issue has been subscribed 1.77 times. The retail category displayed exceptional demand, oversubscribed by 7.01 times, while the Non-Institutional Investors (NII) portion garnered bids 1.67 times.

However, the portion allocated for Qualified Institutional Buyers (QIB) witnessed a subscription of 0.01 times.

Several brokerages recommended investors subscribe to the DOMS IPO, citing reasonable valuations and a strong brand presence that positions the company for sustainable growth.

DOMS IPO consists of a fresh equity issue valued at Rs 350 crore, alongside an offer for sale (OFS) worth Rs 850 crore. In the OFS, promoters Fabbrica Italiana Lapis, Sanjay Mansukhal Rajani, and Keta Mansukhal Rajani will divest their shares.

The price band for this public issue is set at Rs 750-790, with plans to raise Rs 1,200 crore at the upper end. Investors can bid for 18 shares in one lot and in multiples thereafter.

The IPO allocation is distributed, with 75 per cent reserved for qualified institutional buyers, 15 per cent for non-institutional investors, and 10 per cent for retail investors.

At the upper price band, the company is valued at a P/E of 46x EV/EBITDA, with a post-issue market cap of Rs 4,793 crore. Analysts affirm that the IPO is reasonably priced, adding that it is a leading player in the Indian stationery and art material industry and is poised for growth with its diverse product range.

Proceeds from the IPO will be utilised for part funding the cost of establishing a new manufacturing facility and general corporate purposes.

Despite a 41 per cent YoY decline in revenue from operations to Rs 403 crore in FY2023, the company remains resilient, having posted a profit after a loss in the corresponding period last year.

JM Financial, BNP Paribas, ICICI Securities, and IIFL Securities are the appointed bankers for the issue.

Published By:

Koustav Das

Published On:

Dec 13, 2023

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