Sai Silks (Kalamandir) Ltd listed at Rs 231 on the NSE and Rs 230 on the BSE, indicating a 4 percent premium to issue price of Rs 222. The lacklustre debut was on back of warm response from investors during subscription.
The issue was subscribed 4.47 times, with retail portion subscribed only 0.91 times. Qualified institutional buyers had done most of the heavy lifting with their portion subscribed 12.17 times.
With a network of 54 stores in Andhra Pradesh, Telangana, Karnataka and Tamil Nadu, Sai Silks raised Rs 1,201 crore.
The retailer of ethnic apparel, particularly sarees in south India, will be using net fresh issue proceeds for the setting up of 30 new stores at a cost of Rs 125.08 crore, two warehouses with a spend of Rs 25.4 crore and working capital requirements amounting to Rs 280.07 crore. The company will also repay its Rs 50 crore debts via issue proceeds.
The company's return on capital employed (ROCE) stands at 23.5 percent, which is lower than that of its peers, although the numbers are not exactly comparable because of the market segment they cater to.
In terms of financials, revenue increased by 19.7 percent to Rs 1,351.5 crore in FY23, compared to the previous year.
EBITDA (earnings before interest, tax, depreciation and amortisation) in FY23 jumped 60 percent to Rs 212.5 crore, with a margin expansion of 394 bps at 15.72 percent, compared to the previous year. The company's net profit rose 69.1 percent year-on-year in FY23 to Rs 97.6 crore
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