Allied Blenders & Distilleries IPO Closes With Nearly 25% Subscription; Listing On 02 July
We expect a listing at around Rs 360 to 370 per share, resulting in a listing gain of around 27 per cent, says expert
The initial public offering (IPO) of Allied Blenders and Distilleries (ABD), an Indian-made foreign liquor firm (IMFL) closed on 27 June which attempted to raise Rs 1,500 crore.
During its subscription phase, ABD IPO received more than 53 times subscription from Qualified Institutions, however retail subscription stood at 4.73 per cent. Overall, the issue was filled nearly 24.85 times.
ABD IPO allotment is scheduled on 28 June. Subsequently, the IPO will list on the National Stock Exchange (NSE) and Bombay Stock Exchange (BSE) on 02 July.
The IPO consisted of fresh issues of up to Rs 1,000 crore and an offer-for-sale (OFS) worth Rs 500 crore by promoter and investor selling shareholders. The price band for the issue was fixed at Rs 267 to 281.
Nuvama Wealth Management, ICICI Securities and Iti Capital are the book running lead managers, while Link Intime India is the registrar to the offer.
Analyst Advice
“The company marked negligible profits for the reported periods, making its IPO priced exorbitantly on a price to earnings (PE) basis. The management is hopeful of matching the net margin levels with its listed peers in the coming two years. Currently, the company is posting a very thin margin. We expect a listing at around Rs 360 to 370 per share, resulting in a listing gain of around 27 per cent,” said Amit Goel, Co-Founder and Chief Global Strategist, Pace 360.
IPO Objectives
The proceeds from the fresh issue will be utilised to the extent of Rs 720 crore for prepayment or scheduled repayment of a portion of certain outstanding borrowings availed by the company and general corporate purposes.
Additionally, the firm will also get benefits on listing in the public market which will enhance the brand’s visibility and provide liquidity to the shareholders.
Firm’s Financials
The firm registered revenue of Rs 7,116 crore in FY23, compared to Rs 7,208 crore in FY22.
The firm’s profit after tax (PAT) increased to Rs 1.60 crore in FY23 compared to Rs 1.48 crore in FY22.
Overall, revenue decreased by 1.27 per cent, whereas PAT rose by 8.47 per cent.
About Allied Blenders & Distilleries
The Mumbai-based company is the third largest IMFL company in India, in terms of annual sales volumes between Fiscal 2014 and Fiscal 2022 and has an estimated market share of 11.8 per cent in the Indian Whisky market for fiscal 2023.
The Company started its journey in 1988 with the launch of flagship brand, Officer’s Choice Whisky which marked their entry into the mass premium whisky segment. As of 31 December 2023, their product portfolio comprised 16 major brands of IMFL across whisky, brandy, rum, and vodka.
