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Sai Silks (Kalamandir) IPO - Valuations, Issue Details, Peer Comparison, Financials, Risks: Anand Rathi

The issue comprises of fresh issue of 2.7 crore shares worth Rs 600 cr and an OFS of 2.71 crshares aggregating to Rs 601 cr

<div class="paragraphs"><p>Silk saree. (Source: Kalamandir official fb page)</p></div>
Silk saree. (Source: Kalamandir official fb page)

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Anand Rathi Report

Sai Silks (Kalamandir) Ltd. launched its initial public offering today and will be closed on September 22. The price band for the Rs 1,201 crore IPO has been fixed at Rs 210-222 Apiece. The minimum order quantity is 67 shares.

The issue comprises of fresh issue of 2.7 crore shares worth Rs 600 crore and an offer-for-sale of 2.71 crore shares aggregating to Rs 601 crore.

Objects of the Issue

Fresh Issue: Rs 600 crore

  • Funding capital expenditure towards setting up 25 new stores

  • Funding capital expenditure towards setting-up of two warehouses.

  • Full or part repayment and/or prepayment of certain outstanding secured borrowings availed by the company.

  • Funding working capital requirements of the company.

  • General corporate purposes and Unidentified Inorganic Acquisitions.

Valuation

Sai Silk (Kalamandir) is among the leading ethnic and value fashion retail company in south India having a portfolio of established formats with focused sales and marketing strategy with strong presence in offline and online marketplace with an omnichannel network and leading apparel retail brand in India with a scalable model, which is well positioned to leverage growth in the ethnic and value-fashion apparel industry in India with track record of growth, profitability, and unit economics with an efficient operating model.

At the upper price band company is valuing at price/earning of 33 times with a market cap of Rs 34,047 million post issue of equity shares and return on net worth of 24.56%.

We believe that company is fairly priced and recommend a 'Subscribe- Long term' rating to the IPO.

Click on the attachment to read the full IPO report:

Anand Rathi IPO Note Sai Silk Kalamandir.pdf
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