Senco Gold IPO Surges 35.6% on Debut, Receives Robust Investor Response

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Kolkata-based jeweler Senco Gold Ltd made a strong entry into the stock market today as its Initial Public Offering (IPO) listed at a premium of 35.6% on both the National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE). The stock opened at ₹430 per share on the NSE, representing a significant increase over the issue price. On the BSE, the shares were listed at ₹431 per share, reflecting the market’s confidence in the company.

The IPO generated an overwhelming response from investors, with the retail portion being subscribed a remarkable 16.28 times and the overall issue being subscribed an impressive 77.25 times. This substantial demand underscores the trust and enthusiasm of investors for Senco Gold’s growth prospects.

Anubhuti Mishra, Equity Research Analyst at Swastika Investmart Ltd, commented on the listing, stating, “Senco Gold IPO made a strong debut on the stock exchanges today, listing at ₹430 per share, a premium of 36% over the upper end of the price band of ₹317. The strong listing was in line with the expectations. We are not recommending any fresh buying at this level. However, existing investors can hold the shares for the long term with a stop loss at ₹387, as the company has good growth prospects.”

The IPO, which opened on July 4 and closed on July 6, garnered significant interest from qualified institutional buyers (QIBs), retail investors, and non-institutional investors (NIIs). QIBs subscribed a remarkable 190.56 times, while NIIs subscribed 68.44 times. The strong response from retail investors, subscribing 16.28 times, further demonstrates the widespread appeal of Senco Gold’s offering.

Senco Gold’s IPO comprised a fresh issuance of shares worth ₹270 crore and an offer-for-sale (OFS) of equity shares worth ₹135 crore by investor SAIF Partners India IV. The net proceeds from the new issue will be utilized for general business needs and working capital requirements, consolidating the company’s growth trajectory.

The impressive financial performance of Senco Gold played a vital role in attracting investors. The company’s revenue and profit after tax exhibited a robust two-year compound annual growth rate (CAGR) of 24% and 61% respectively. In FY23, Senco Gold reported a net profit of ₹158.48 crore compared to ₹129.10 crore the previous year. Additionally, its revenue for the year amounted to ₹4,077.40 crore, a notable increase from ₹3,534.64 crore in the preceding year.

With its extensive retail network comprising 136 showrooms across 96 cities in 13 states and union territories, Senco Gold has established a strong presence in Eastern India’s jewelry market. The company’s successful IPO debut and the overwhelming investor response reflect its potential for continued growth and prosperity in the highly competitive jewelry industry.