Cello World has initiated its initial public offering (IPO) for subscription, providing an opportunity for prospective investors to participate from October 30 to November 1. This IPO is categorized as an offer-for-sale (OFS) and involves up to 2.93 crore shares, with no proceeds directed to the company itself. Notably, major stakeholders like Pradeep Ghisulal Rathod, Pankaj Ghisulal Rathod, Gaurav Pradeep Rathod, and others are participating in this offer-for-sale.
Key details, including the Grey Market Premium (GMP), are as follows: The IPO offers a chance for potential investors to acquire shares within a price range of Rs 617-648 per equity share, with a lot size of 23 shares and multiples thereafter. For those contemplating participation, Cello World has allocated 50% of the net offer to qualified institutional bidders, while 15% is designated for non-institutional investors. The remaining 35% is reserved for retail investors. As of today, the Grey Market Premium (GMP) for Cello World stands at Rs 121.
Leading up to the IPO launch, Cello World successfully allocated 87,49,999 shares to 39 anchor investors at a price of Rs 648 each, amassing an impressive Rs 567 crore. The allotment of shares for the IPO will be finalized on November 6, and the company is set to make its debut on Dalal Street on November 9, 2023.
Operational and financial performance highlights of Cello World include its operation of 13 strategically located manufacturing units across five different sites in India. Furthermore, the company has outlined plans to establish a state-of-the-art glass manufacturing unit in Rajasthan, equipped with European-made machinery to enhance productivity and manufacturing capacity.
As of March 31, 2023, Cello World manages an extensive portfolio of 15,841 stock-keeping units (SKUs) and maintains a robust sales distribution team.
Regarding financial performance, Cello World reported a net profit of Rs 82.83 crore, with revenue totaling Rs 479.88 crore for the period ending on June 30, 2023. Additionally, for the fiscal year ending on March 31, 2023, the company posted a net profit of Rs 285.06 crore, with revenue amounting to Rs 1,813.44 crore.
Prominent brokerage firms have offered their insights on the Cello World IPO. Reliance Securities has given a 'subscribe' rating to the IPO, expressing bullish sentiment toward Cello World, emphasizing its strong brand identity and growth potential, and viewing it as a promising long-term investment.
Choice Broking has also assigned a 'subscribe' rating to Cello World's IPO, citing its dominant market position and growth prospects. However, the brokerage has raised concerns about overvaluation, advising investors to exercise caution.
StoxBox has given a 'subscribe' rating to the IPO as well, highlighting Cello World's distribution advantage and a superior return on capital employed (ROCE) in comparison to peers. The brokerage believes that investors might potentially benefit from listing gains.
Aditya Gaggar, Director of Progressive Shares, has noted that Cello World has built a strong brand identity through effective brand advertisements and marketing campaigns. He believes the company is well-positioned to benefit from the shift from an unorganized to an organized segment in the consumer ware market.
In conclusion, while this IPO is an offer for sale and some investors might not be inclined towards aggressively priced OFS offerings, those with surplus funds or long-term investment perspectives might consider participating in this IPO.
