For those of us who cook meals from time to time, the brand Pigeon might ring a bell. The rest of us who don’t should probably ask our mothers. She’ll likely pick out a mixer grinder or some utensil with ‘Pigeon’ stamped on it. That brings us to the fourth IPO in the month of January. Stovekraft, Pigeon’s parent brand, is all set to go public. We tell you what this IPO is all about.
Issue details
Price band: ₹384-385
Lot size: 38 equity shares
Issue opens on: 25 January 2021
Issue closes on: 28 January 2021
Basis of allotment date: 3 February 2021
Initiation of refunds: 4 February 2021
Credit of shares to Demat account: 5 February 2021
Expected listing date: 8 February 2021
Registrar: KFin Technologies Private Limited
Contact: M Murali Krishna, +91 40 6716 2222
E-mail: hffcl.ipo@kfintech.com
Click here to apply for the IPO
About the company
Popular for the Pigeon and Gilma brand, Stovekraft is a Bangalore-based kitchen appliances company founded in 1999. It is known for its pressure cookers, non-stick cookware, and cooking stoves, and also makes kitchen chimneys and food blenders among other kitchen utilities.
Among Indian brands, it is the market leader in the cooktops (multi-burner stoves) and free-standing stoves categories with a market share of 25%* and 20.3%* respectively. The segment is expected to grow at 13.6%* CAGR in 2020-25.
TTK Prestige and Hawkins corner about 48%* and 35%*, respectively, of the pressure cooker market, which is set to grow at 7.4%* CAGR in 2020-25. Pigeon is the third-largest player in the category, with a market share of 11.4%*.
It is also the third-largest player in the non-stick cookware space with a 18.9%* market share, with TTK Prestige capturing 58.2%* of the segment. The non-stick cookware category is set to grow at nearly 10%* CAGR till 2025.
Note: *All market shares are by volume.
Stovekraft has two manufacturing facilities, one in Bengaluru and the other in Baddi, Himachal Pradesh. As of 30 September 2020, it had 651 distributors in 27 states and five union territories. These distributors are, in turn, connected to a dealer network of 45,475 retail outlets.
The company reported revenues of ₹534.6 crore of FY18, ₹642.6 crore in FY19, ₹672.9 crore in FY20, and ₹329.5 crore in the first two quarters of FY21. It netted losses to the tune of ₹12 crore in FY18, but has grown profits subsequently. Profits stood at ₹73.6 lakh in FY19, ₹3.1 crore in FY20 and rose significantly to ₹28.7 crore in H1 of FY21.
Financials for FY18, FY19 and FY20
| H1, FY21 | FY20 | FY19 | FY18 | |
| Revenue (₹ cr) | 329.5 | 672.9 | 642.6 | 534.6 |
| Profits (₹ cr) | 28.7 | 3.1 | 0.73 | -12 |
About the issue
The IPO comprises a fresh issue of ₹95 crore and an offer for sale (OFS) of up to 8,250,000 equity shares. Through the OFS, founder and promoter Rajendra Gandhi and Sunita Rajendra Gandhi, along with Sequoia Capital India will dilute their stakes in the company. The proceeds from the fresh issue will largely go to repayment of the company’s debts, about ₹76 crore.
At least 75% of the offer will be allocated to qualified institutional buyers (QIBs) such as mutual funds. Bids from non-institutional investors have been capped at 15% of the offer, while the quota for retail investors is capped at 10%.
To know more about the IPO, read its red herring prospectus here. You can subscribe to the Stovekraft IPO with Upstox here. Meanwhile, we’ll keep you posted on all the updates about this IPO and the public issues that follow!