Shares of Khadim India Ltd debuted on the stock exchanges at Rs727, a 3.07% discount from its issue price of Rs750 per share. The company’s Rs543 crore initial public offer (IPO), which was subscribed 1.90 times during the share sale from 2-6 November, had a price band at Rs745-750 per share.
At 10.22am, the stock was trading at Rs720.10, down 3.99%, on the BSE, while the Sensex was down 0.10% at 33,001.61 points. The stock touched a low of Rs712.40 and a high of Rs740.
Ahead of its share sale, analysts had said that the issue was fairly priced. According to ICICI Securities Ltd, at the higher end of the price brand of Rs750, the stock is valued at 2.2 times market capitalisation to sales and price to earnings of 43.8 times on FY17 numbers which is reasonably valued as compared to its peers.
Net proceeds from the fresh issue will be utilized for prepayment or scheduled repayment of all or a portion of term loans and working capital facilities availed by the company.
The company has a strong presence in eastern India and has positioned itself as an affordable brand. It has 853 branded exclusive retail stores in 23 states and one Union territory.
The company outsources its production to vendors and procures 85% of its requirement from them. It caters to customers who shop at multi-brand outlets (MBOs) through distribution network. It has manufacturing facilities at Panpur and Kasba (in West Bengal) and four distribution centres across India.