Vishal Mega Mart IPO subscribed 51% on day 1 of issue, NIIs place highest bids; Latest GMP here

Vishal Mega Mart IPO: The mainboard initial public offering (IPO) of Vishal Mega Mart Limited received a tepid response from investors on the first day of subscription. The ₹8,000-crore worth public issue of the supermarket store operator hit India's primary market on Wednesday, December 11, 2024, to open for its three-day subscription period. The public issue will close on Friday.

Vishal Mega Mart IPO has reserved not more than 50 per cent of the equity shares in the public issue for the qualified institutional buyers (QIB), not less than 15 per cent for non-institutional Institutional Investors (NII), and not less than 35 per cent of the offer is reserved for the retail individual investors.

Follow Live Updates: Vishal Mega Mart IPO Day 1: Issue booked 51% so far, NII portion subscribed 1.11x; check GMP, other details

Vishal Mega Mart IPO Subscription Status

On the first day of subscription, Vishal Mega Mart IPO was subscribed 51 per cent by the end of the session. The portion reserved for retail investors was subscribed 53 per cent, the portion reserved for QIBs was booked 0.03 per cent, and the portion reserved for NIIs was booked the highest among the three groups at 1.11 times. According to BSE data, the IPO received 38,63,32,890 share applications against 75,67,56,757 shares offered on Wednesday.

Vishal Mega Mart IPO Latest GMP Today

According to Invstorgain.com, the latest Grey Market Premium (GMP) for the Vishal Mega Mart IPO stood at ₹20. Based on the price band of ₹78, the projected listing price is ₹98, calculated by adding the cap price to the current GMP. This translates to an anticipated gain of 25.64 per cent per share. 'Grey market premium' indicates investors' readiness to pay more than the issue price. 

Also Read: Vishal Mega Mart IPO day 1: GMP, subscription status, review, other details. Apply or not?

Vishal Mega Mart IPO Details

Vishal Mega Mart's IPO is an offer for sale (OFS) of 102.56 crore equity shares. At the upper end of the price band, the IPO size is ₹8,000 crore. The IPO consists entirely of an OFS amounting to ₹8,000 crore by Samayat Services LLP, the promoter with a 96.46 per cent stake in Vishal Mega Mart. At the upper price band of ₹78, it is expected to have a market capitalization of ₹36,120 crore. 

Vishal Mega Mart IPO's price band has been fixed at ₹74 to ₹78 per equity share with a face value of ₹10. The lot size is 190 equity shares, multiples of 190 equity shares thereafter. The issue will close for subscription for all groups of investors on Friday, December 13, 2024. The IPO raised ₹2,400 crore from anchor investors.

Tentatively, Vishal Mega Mart IPO's basis of allotment of shares will be finalised on Monday, December 16. The company will initiate refunds on Tuesday, December 17, and the shares will be credited to the Demat account of allottees on the same day following the refund. Vishal Mega Mart's share price will likely be listed on BSE and NSE on Wednesday, December 18.

Kotak Mahindra Capital Company Limited, ICICI Securities Limited, Intensive Fiscal Services Private Limited, Jefferies India Private Limited, J.P. Morgan India Private Limited, and Morgan Stanley India Company Pvt Ltd are the book-running lead managers of the Vishal Mega Mart IPO, while Kfin Technologies Limited is the registrar for the issue.

Also Read: Vishal Mega Mart IPO: Price band set at ₹74-78 per share; check issue details, key dates, more

Vishal Mega Mart Company Details

Established in 2001, Vishal Mega Mart is a hypermarket chain offering various products, including apparel, groceries, electronics, and home essentials. It targets middle—and lower-middle-income people through a network of 645 stores (as of September 30) and its Vishal Mega Mart mobile app and website.

The company features both its own brands and third-party brands to fulfil consumers' everyday needs. Its extensive product range includes clothing, general merchandise, and fast-moving consumer goods (FMCG), offering home furnishings, travel accessories, kitchen appliances, food items, non-food products, and staples.

According to the red herring prospectus (RHP), the company's listed peers are Avenue Supermarts Ltd. (with a P/E of 98.23 times) and Trent Ltd. (with a P/E of 163.59). Between the fiscal years that ended on March 31, 2024, and March 31, 2023, Vishal Mega Mart's total sales grew by 17.41 per cent and net profit rose by 43.78 per cent.

Vishal Mega Mart IPO Review

Vishal Mega Mart, the second-largest offline-first diversified retailer, is well placed to capitalize on India's growing middle-class population. Extensive expansion plans focusing on diversification, high-margin products and operating leverage will likely bolster revenue growth. “At ₹78, the issue is priced at 76x FY24 P/E and looks reasonable compared to peers. We recommend investors to ‘Subscribe’ to the issue,” said domestic brokerage Motilal Oswal Financial Services on Vishal Mega Mart IPO.

Disclaimer: The views and recommendations provided in this analysis are those of individual analysts or broking companies, not Mint. We strongly advise investors to consult with certified experts before making any investment decisions, as market conditions can change rapidly and individual circumstances may vary.