Shanti Gold International IPO: A Strong Subscription and Promising Outlook
The Shanti Gold International IPO has generated significant buzz in the market, achieving an impressive overall subscription rate of 80.80 times on its final day. This overwhelming demand has been primarily fueled by retail investors and non-institutional investors (NIIs), reflecting a robust interest in the company’s offerings. With a grey market premium (GMP) hovering around Rs 37 per share, investors are eyeing a potential listing gain of approximately 18.59% over the upper end of the price band, which is set at Rs 199 per share.
Shanti Gold IPO: Subscription Status
The enthusiasm among retail investors has been particularly noteworthy, with this segment receiving subscriptions 29.77 times for the 63.33 lakh shares allocated to it. The demand from Non-Institutional Investors (NIIs) was even more pronounced, with subscriptions reaching an astounding 151.18 times. Qualified Institutional Buyers (QIBs) also demonstrated strong interest, with their subscriptions hitting 117.33 times for the allotted 38.19 lakh shares. This widespread interest underscores the confidence investors have in Shanti Gold’s growth trajectory and market potential.
Shanti Gold IPO: GMP Today
As of the latest updates, the grey market premium (GMP) for the IPO stands at approximately Rs 33 per share, suggesting a potential listing gain of about 16.5% over the upper price band of Rs 199. The GMP serves as an unofficial indicator of the expected trading price before the shares officially list. Investors can apply for a minimum lot size of 75 shares, which amounts to Rs 14,925 at the upper end of the price band, with the option to apply for additional lots thereafter.
Prior to the IPO, Shanti Gold International successfully raised Rs 108 crore from anchor investors, with notable allocations to firms such as Societe Generale, Wealthwave Capital Fund, and others, as per a filing on the BSE.
About the Company
Shanti Gold International, headquartered in Mumbai, specializes in the manufacturing of 22kt CZ casting gold jewellery. The company primarily operates on a B2B model, catering to large retail chains, including well-known names like Joyalukkas, Lalithaa Jewellery Mart, and Alukkas. Currently, over 70% of its revenue is generated from sales across southern India.
In a strategic move to expand its market presence, Shanti Gold plans to establish a new 1,200 kg manufacturing unit in Jaipur, targeting the plain jewellery segment in North India.
Company Financials and Valuations
Shanti Gold has demonstrated robust financial growth in recent years. Revenue surged from Rs 679 crore in FY23 to Rs 1,106 crore in FY25, while net profit increased from Rs 19.8 crore to Rs 55.8 crore during the same period, reflecting a remarkable CAGR of 68%.
The company’s EBITDA margins have steadily expanded to 8.83%, and the return on equity (RoE) stood at a healthy 44.85% in FY25. The IPO values the company at a post-issue P/E of 19x, which is attractive compared to the industry average of 23x. However, the price-to-book valuation at 7x appears slightly stretched when compared to its listed peers.
Should You Subscribe to Shanti Gold IPO?
Brokerages have largely recommended subscribing to the Shanti Gold IPO, citing strong financials, margin expansion, and a clear strategy for diversifying its product mix and regional footprint.
According to Canara Bank Securities, "The company’s robust relationships with marquee jewellers, expanding design capabilities (over 400 designs/month), and controlled in-house manufacturing give it scale and brand trust in the B2B jewellery segment."
While there are risks associated with customer and regional concentration, the overall growth momentum and solid business fundamentals present an attractive investment opportunity.
(Disclaimer: Recommendations, suggestions, views, and opinions given by the experts are their own. These do not represent the views of The Economic Times.)
In conclusion, the Shanti Gold International IPO stands as a testament to the growing confidence in the Indian jewellery market, driven by strong demand and promising financials. Investors looking for opportunities in this sector may find this IPO worth considering.