Baazar Style Retail IPO subscribed nearly 41 times as on final day; GMP declines to 14%. Check details

The initial public offering (IPO) of Baazar Style Retail was overall subscribed 40.63 times at the final day of the bidding process. The issue sailed through on the second day iself, driven by strong demand from Non-institutional investors who ended up subscribing the issue 59.41 times.

The quota reserved for retail individual investors (RIIs) was subscribed 9.07 times. The allocation for qualified institutional bidders was booked 81.83 times.

However, the grey market premium (GMP) for Baazar Style Retail has declined to nearly Rs 53, representing a 14% premium in the unlisted market. On the first day of bidding, the GMP was at Rs 130, indicating a 33% premium over the issue price.

The IPO includes a combination of fresh equity issue of Rs 148 crore and an offer of sale of up to 1.76 crore shares. Under the OFS, Rekha Jhunjhunwala, among others, will sell shares.

Net proceeds from the IPO would be used to clear borrowings and for general corporate purposes.

Baazar Style Retail IPO price band

The company has fixed a price band of Rs 370-389 per share, where investors can bid for 38 shares in one lot.

Baazar Style Retail IPO review

Analysts advised investors to subscribe to the IPO as the company is well-positioned to capture a larger share of the growing Indian retail market.

"Compared to its peers, Baazar Style Ltd is growing at a faster pace, moreover, it is trading at a discount at FY24 adjusted PE of 132x, versus 139x for V2 Retail. Considering these factors, we assign a subscribe rating to the IPO," said Deven Choksey Research.

Meanwhile, brokerage firm Geojit said, "Considering the rise in demand, aggressive store additions, customer retention, cluster-based expansion model, and positive industry growth opportunities, we assign a ‘subscribe’ rating on a short to medium-term basis."

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Other details

Kolkata-based Baazar Style Retail is a value fashion retailer with the largest retail footprint in Eastern India and leadership positions in West Bengal and Odisha in the organised value retail market. As of March 31, 2024, BSRL has 162 stores spread across over 1.47 million square feet in 146 cities operated under the brand name “Style Bazaar”.

It has a market share of 3.03% and 2.22%, respectively, in the organised value retail market in West Bengal and Odisha.

The company is backed by investors including Rekha Rakesh Jhunjhunwala, the wife of the Late Rakesh Jhunjhunwala, Kewal Kiran Clothing, Manohar Lal Agarwal, promoter of Haldiram Snacks, among others.

Its revenue from operations grew from Rs 551 crore in FY22 to Rs 973 crore in FY24, indicating a CAGR of 32.86% while the overall lifestyle and home value retail market has been estimated to have grown at a CAGR of 19.3% from FY22 to FY24.

The book-running lead managers of the IPO are Axis Capital, Intensive Fiscal Services and JM Financial.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)