Flair Writing Industries IPO draws massive interest with sevenfold subscription
2023.11.24 02:06
© Reuters.
MUMBAI – Flair Writing Industries’ initial public offering (IPO) has closed today with a remarkable response from investors, reaching nearly seven times the offered size. The IPO, which launched on Wednesday, saw its share price set between ₹288-₹304 and a lot size of 49 equity shares. Retail investors showed significant interest, subscribing over seven times their allocated quota.
The grey market premium suggests a strong demand for the company’s shares, with early investors willing to pay a premium over the issue price to secure their stake. By this morning, bids had exceeded nine times the offering, with an estimated listing price at ₹386/share, a substantial increase of around 27% from the IPO rate.
A brokerage firm has recommended subscribing to the IPO based on Flair Writing’s solid financial track record and positive future prospects. The company’s valuation attractiveness is highlighted by a P/E ratio of 24.01x, and its status as a market leader with potential for further growth and margin expansion.
Retail participation in the IPO soared to an impressive eightfold, while non-institutional interest exceeded twelvefold their portions. The enthusiastic response came after prominent investors such as Theleme India Master Fund and Troo Capital invested ₹177.9 crore during the anchor investment phase on Tuesday.
Flair Writing plans to use the proceeds from the issuance for various strategic initiatives. These include expanding its manufacturing facilities, such as building a new unit in Valsad costing ₹55.99 crore, capital expenditures totaling ₹86.75 crore, and meeting working capital needs of ₹77 crore. With a nine percent share in India’s pen industry and FY23 earnings reaching ₹915.55 crore (INR100 crore = approx. USD12 million) across various brands like Flair and Hauser, the company cements its leadership position in the market.
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