PN Gadgil Jewellers IPO Day 2: Issue subscribed 2.23 times so far; check strengths, risks and more

PN Gadgil Jewellers IPO Day 2: The initial public offer of PN Gadgil Jewellers Ltd, a jewellery retail chain, has received 2.23 times subscription so far on Wednesday, the second day of bidding.

According to the consolidated data on the NSE website, the ₹1,100 crore IPO received bids for 3,77,37,757 shares against 1,68,85,964 shares on offer.

PN Gadgil Jewellers IPO Day 2: Subscription status

The Maharashtra-based company had mobilised ₹330 crore from anchor investors before the IPO.

The public offer, which went live on September 10, will conclude on September 12. The price range is fixed at ₹456-₹480 per share.

The IPO is a fresh issue of shares worth up to ₹850 crore and an offer for sale (OFS) component of ₹250 crore by promoter SVG Business Trust, which currently holds a 99.9% stake in the jewellery chain.

Of the money raised, ₹393 crore will be used to establish 12 new stores in Maharashtra, ₹300 crore for clearing debt and a portion for general corporate purposes.

PN Gadgil Jewellers IPO: Strengths

• A well-established and trusted legacy brand in the state of Maharashtra
• The company is well positioned as the second largest organised jewellery player in Maharashtra
• It has the second-highest EBITDA growth among the major organised jewellery players in India
• Diversified product portfolio
• Strong historical financial results

PN Gadgil Jewellers IPO: Risks

• Business is primarily concentrated in Maharashtra
• Requires considerable working capital. As of July 31, 2024, the company has a total outstanding borrowings of ₹348 crore.
• Operates in a fragmented and largely unorganised industry
• The company is dependent on third-party artisans to manufacture and produce all its products.
• Sales are subject to seasonal fluctuations
• Volatility in prices of precious metals can affect its profitability.