At the greater finish of the price tag band, Indigo Paints IPO is aggressively priced at a PE ratio of 142 occasions FY20 earnings per share
Indigo Paints’ Rs 1,170.16-crore initial public offer you will open for subscription on Wednesday in the price tag band of Rs 1,488-1,490 apiece. One day just before the IPO opening, Indigo Paints shares have been trading with a 54.36 per cent premium more than the IPO price tag in the grey industry today. The shares of the fifth-biggest organization in the decorative paint business have been trading at Rs 2,300, up Rs 810 from the challenge price tag. Indian share industry benchmarks, BSE Sensex and Nifty 50 have been ruling with more than one particular per cent gains in today’s session.
Analysts at INDmoney have been of the view that at the greater finish of the price tag band, Indigo Paints IPO is aggressively priced at a PE ratio of 142 occasions FY20 earnings per share. This is comparable to its very valued listed peers Asian Paints (115) and Berger Paints India (126). They also added that Indigo Paints has a far better development prospective due to its reduced base and industry share. “Given strong fundamentals, good return ratios, and attractive growth prospects we remain positive on the prospects of the issue” INDmoney mentioned in a report.
Indigo Paints IPO comprises fresh challenge of stocks worth Rs 300 crore and an OFS of up to 58.40 lakh equity shares by private equity firm Sequoia Capital, via its two funds – SCI Investments IV and SCI Investments V – and promoter Hemant Jalan. The shares are proposed to be listed on each BSE and NSE. Most of the brokerage homes have advised to ‘subscribe’ to the challenge as Indigo Paints enjoys early mover benefit in floor painting, with the increasing sale of differentiated merchandise which yields greater margin.
Analysts at investigation firm Hem Securities mentioned that Indigo Paints remained least impacted throughout COVID-19 pandemic (development in sales and ebitda margin terms) as compared to peers due to comprehensive presence in compact towns which could be one particular of the cause that led organization outperform its peers throughout covid occasions and now expanding more rapidly into huge cities. Those at Angel Broking have also advised to ‘subscribe’ as strategically positioned manufacturing facilities with proximity to raw supplies helped to report far better gross margins. Keshav Lahoti, Associate Equity Analyst at Angel Broking Ltd, is positive on the extended-term prospects of the business as effectively the organization and advised to ‘subscribe’ to IPO for extended-term as effectively as for listing gains.
Analysts at IIFL Securities think that mixture of greater development and reduced valuations tends to make for an fascinating investment chance in Indigo Paints challenge. IndiGo Paints challenge will conclude on January 22, 2021.