- Arihant Capital, BP Equities, Choice Equity Broking, Reliance Securities, Ventura, Marwadi and Anand Rathi have given a “Subscribe” recommendation to the IPO
- Sai Silks (Kalamandir) Limited on Monday raised Rs 360 crore from 26 anchor investors at the upper price band of Rs 222 per Equity Share
- Sai Silks Kalamandir Ltd is among the top 10 ethnic wear retailers in south India with a dominant presence in Sarees across the value chain: Arihant Capital
| Sai Silks Kalamandir Limited IPO | |
| Arihant Capital | Subscribe |
| BP Equities | Subscribe |
| Choice Equity Broking | Subscribe |
| Reliance Securities | Subscribe |
| Ventura | Subscribe |
| Marwadi Financial Services | Subscribe |
| Anand Rathi | Subscribe for Long Term |
NE BUSINESS BUREAU
AHMEDABAD, SEPT 21
IPO notes of some of the leading brokerages have recommended subscribing to Sai Silks Kalamandir’s Rs. 1,200 crore IPO, which closes for subscription on Friday, September 22, 2023.
Sai Silks (Kalamandir) Limited on Monday raised Rs 360 crore from 26 anchor investors at the upper price band of Rs 222 per Equity Share. The Anchor Book included marquee investors such as White Oak, Abakkus, SBI MF, ICICI Prudential MF, HDFC MF, Kotak MF, HSBC MF, Aditya Birla Sunlife MF and UTI MF.
According to Arihant Capital’s report, Sai Silks Kalamandir Ltd is among the top 10 ethnic wear retailers in south India with a dominant presence in Sarees across the value chain (which constitute 2/3rd of revenues, the rest coming from salwar kameez sets, menswear, kidswear etc.). They are the youngest textile company to cross the Rs 1,000 Cr revenue mark in just 17 years since its inception.
Giving a subscribe rating, the report goes on to say that “SSKL has organically built its strengths from the ground up which has reflected in its healthy growth in profitability and revenues over the years. The driven and skilled management has been a key reason for its success. We believe it is well poised to grow into the future given its market leadership, focus on providing good quality products and enhancing customer experience”
Reliance Securities observes in its report that “The Indian ethnic wear business is a difficult business to replicate, given its high customer needs and complex inventory management. Dressing in ethnic wear is now a common trend not only at wedding celebrations but also country-wide festivals and other occasions and celebrations.
SSKL’s production is in-house and through third parties and its entire supply chain and inventory management is system driven and algorithmically managed at every stage in its supply and distribution chain. SSKL intends to continue to enhance the brand recall of products through the expansion of footprint digital marketing campaigns, brand ambassador content and outdoor advertising. This gives SSKL a strong competitive advantage in the women’s ethnic wear, strong margins and returns profile over the past few years, we expect consistent growth in its key metrics through its store expansion over the next few years, we recommend a SUBSCRIBE to the issue.
BP Equities’ report states “On the upper price band, the issue is valued at a P/E of 27x based on FY2023 earnings which is lower compared to its peers and is reasonable for the retail business where the valuation matrix should only get better from hereon. We, therefore, recommend a SUBSCRIBE rating for the issue.”
Choice Equity Broking in its report mentions “Setting aside the challenges posed by the COVID-19 pandemic, the company has showcased impressive growth in terms of both revenue and profitability. The company’s P/E multiple at a higher price band, after adjusting for post-IPO fully diluted paid-up equity, comes out to 34.9x (to its FY23 EPS of Rs. 6.36), which seems fairly valued. If we compare SSKL to its peer companies, the company appears to hold a favorable position, particularly when evaluating their respective performances. As part of its expansion strategy involving the establishment of new stores, SSKL is poised to consistently increase its revenue, facilitating steady and sustainable growth in the long term and thus we assign a “SUBSCRIBE” rating for the issue”
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Capital Market: Sai Silks Kalamandir sets price band at ₹210-222 per share for ₹1,201-crore IPO
