Sula Vineyards IPO Subscription Day 3: The initial public offering (IPO) of Sula Vineyards was subscribed 67 per cent on Day 3 of the bidding process. The issue received total bids of 1,25,28,768 shares against the issue size of 1,88,30,372 shares. The company has fixed a price band of Rs 340-357 per equity share for its Rs 960 crore public offer.
Sula Vineyards IPO: Subscription Status
The quota reserved for retail individual investors (RIIs) was fully booked (1.11 times) and that of non-institutional investors (NIIs) received 50 per cent subscription by 10:36 am on Wednesday. However, the qualified institutional buyers (QIB) portion failed to attract any bids so far.
Sula Vineyards IPO: Financials
For the year ended on March 31, 2022, the company reported a total revenue of Rs 456.7 crore with a net profit of Rs 52.14 crore, which was Rs 421.53 crore and Rs 3.01 crore in the year-ago period.Sula Vineyards’ bottomline stood at Rs 30.51 crore with total revenue of Rs 225.76 crore for the period ended on September 30, 2022.
Kotak Investment Banking, CLSA and IIFL Securities are the book running managers to the IPO and KFin Technologies Limited is the registrar to the offer. Law firms Shardul Amarchand Mangaldas and Trilegal are the legal advisors, as per the draft papers filed with SEBI.
Sula Vineyards IPO: GMP
As per the market observers, shares of Sula Vineyards Ltd are available at a premium of Rs 34 in grey market today, which means Sula Vineyards GMP today is Rs 34. On Sunday, Sula Vineyards IPO GMP was Rs 24 that means Sula Vineyards share price has surged Rs 10 in grey market today.
Sula Vineyards IPO: Share Allotment Status
Those who would bid for the issue can check the subscription status on the online portal of KFin Technologies, the registrar of the IPO.
About Sula Vineyards
The Nashik-based wine maker has been recognised as the market leader across wine variants, including red, white and sparkling wines. The firm distributes wines under a bouquet of popular brands like Sula, its flagship brand, besides other popular brands like RASA, Dindori, The Source, Satori, Madera & Dia.
Sula has been backed by various private equity funds and institutional investors, including Verlinvest, Everstone Capital, Visvires, Saama Capital, and DSG Consumer Partners.The distribution platform of the company included over 47 distributors, 10 corporations, 23 licensed resellers, 7 company depots, 4 defence units and over 23,000 points of sale as of March 31, 2022.
Sula Vineyards IPO: Financials
Over FY20-22, the company reported a 6.7% CAGR fall in the consolidated revenue, which stood at Rs. 453.9 cr in FY22. During the period total sales volume increased by 1.5 per cent CAGR, while lower focus on the distribution of third party brands led to 9.4 per cent CAGR fall in the blended realization. Wine business from the owned brands increased by 7.2 per cent CAGR, while business from third party brands declined by 53 per cent CAGR. Consequently, business contribution from the sales of owned brands increased from 63.6 per cent in FY20 to 83.9 per cent in FY22. Business from wine tourism vertical increased by 10.9 per cent CAGR, while its business contribution stood at 7.6 per cent in FY22.
Sula Vineyards IPO: GMP
Market participants said Sula Vineyards IPO grey market premium (GMP) was last heard at Re 1, down from Rs 5 on Tuesday and Rs 19 on Monday. It implied that the grey market expected the company to stage a muted listing.
Should You Invest?
Anand Rathi said termed the issue as “fairly priced” and recommended a “Subscribe- Long Term” rating.
“The stock is a pure play on the wine sector, which currently sits on a low base (less than 1 percent of alcoholic beverage industry) but is expected to surpass industry growth due to higher acceptability, affordability, perceived health benefits, etc,” said ICICI Direct which assigned a rating of subscribe with a long term horizon to the IPO as the industry is currently in a nascent stage and demand centres remain concentrated mainly in a few metros.
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