D-Mart tops IPO charts since 2010

Investors across segments queued up for the initial public offering (IPO) of Avenue Supermarts, which operates the successful retail chain D-Mart, mainly in Maharashtra and Gujarat. The Rs 1,840-crore offering, which closed on Friday, saw 104 times more demand than the shares on offer. The issue generated bids worth Rs 1.38 lakh crore — the most since Coal India’s IPO in 2010. The so-called qualified institutional buyer (QIB) portion of the IPO was subscribed 146 times, high-networth individual (HNI) segment was subscribed 281 times and retail investor portion saw seven times more demand than the shares on offer. Investors applied for 4.6 billion shares in the IPO, where only 44.37 million shares were being offered. D-Mart had already raised Rs 534 crore from anchor investors by allotting them 18.76 million shares.  Financial Astrology Tips

Market experts say investors were enthused by the company’s financial track record, attractive valuations, compared to peers and strong growth prospects. “Given the euphoria surrounding this issue, we were expecting this kind of demand. The success of the issue is a thumbs up to India’s retail sector, where D-Mart is one of the best company,” said Dharmesh Mehta, managing director & chief executive officer, Axis Capital.  Added Narayanan Sadanandan, group head–investment banking, SBI Capital Markets, “The IPO had generated a lot of enthusiasm among investors during the roadshows. D-Mart is a well-known brand with superior business model and good earnings visibility.” Astrology and Numerology Trading Tips

Axis Capital and SBI Capital Markets were bankers to the issue, along with Kotak Mahindra Capital and five others. D-Mart is promoted by one the country’s ace capital market investor Radhakishan Damani. Along with his family, Damani — no longer on the board or management — will own 82.2 per cent stake in the company after listing, which will be valued at Rs 15,338 crore at the IPO price. The company will be valued at Rs 18,660 crore. The IPO is likely to be priced at the top end of the price band of Rs 295 to Rs 299 per share. D-Mart will mobilise Rs 1,840 crore (9.2 per cent dilution) from the IPO — around Rs 1,080 crore will be used to retire outstanding debt and Rs 367 crore will go towards setting up of new stores. Between FY12 and FY16, D-Mart had shown compounded annual growth rate of 40 per cent and profit growth of 52 per cent. In the first nine months of FY17, the company had posted a profit of Rs 387 crore on sales of Rs 8,784 crore. On an annualised basis, the stock commands an enterprise value (EV) to sales of 1.7 times; EV to Ebitda (earnings before interest, tax, depreciation and amortisation) of 19.5 times, and price to earnings of 35.6 times. Commodity Trading Tips