MUMBAI, 6 DECEMBER, 2024 (GPN): Vishal Mega Mart, a prominent player in India’s organized retail sector, is launching its Initial Public Offering (IPO) on December 11, 2024. The IPO subscription closes on December 13, 2024. The company aims to raise Rs 8,000 crore by dumping promoters’ and other selling shareholders’ 102.56 crore shares. The company’s IPO price band ranges between Rs 74 to Rs 78 per equity share.  This Rs. 8,000 crore offering is the fourth largest IPO in India this year. The IPO is entirely an Offer for Sale (OFS), meaning proceeds will go to the selling shareholder, Samayat Services LLP, which holds a 96.55% stake in the company.

Founded in Gurugram, Vishal Mega Mart is known for serving middle- and lower-middle-income consumers with an extensive range of products, including apparel, FMCG, and general merchandise. As of June 2024, the company operates 626 stores nationwide, supplemented by an e-commerce presence through its app and website.

India’s retail market, currently valued at Rs. 68-72 trillion, is projected to grow at a 9% CAGR to reach Rs. 104-112 trillion by 2028. The shift towards organized retail is driven by higher quality expectations, better pricing, urbanization, and product variety. Vishal Mega Mart competes with giants like Reliance Retail, DMart, and Trent while maintaining its niche in affordable products.

The company reported robust financial performance for FY24:Revenue: Rs. 8,911.9 crore, up 17.5% YoY; Net Profit: Rs. 461.9 crore, a 43.8% increase YoY.This growth underscores its ability to navigate competitive challenges while expanding its reach.

The allotment of shares of Vishal Mega Mart IPO is expected to be finalised on December 16. Meanwhile, the listing on the bourses – NSE and BSE – on December 18, as per the tentative plan.The company offered not more than 35% of the issue to retail investors and 15% to NIIs. While, it reserved 50% of the issue for QIBs.

Vishal Mega Mart is a hypermarket chain that sells a wide range of products like apparel, groceries, electronics, and home essentials. They own their brands and third-party brands to meet the everyday needs of consumers. The company offers a wide range of products across apparel, general merchandise, and FMCG, including its brands for clothing, home furnishings, travel accessories, kitchen appliances, food, non-food items, and staples.

A retail buyer needs to apply for a minimum of 190 shares in a lot which amounts to Rs 14,820. There are different lot sizes for small and big NIIs. A small NII can apply for a minimum of 2,660 shares amounting to Rs 2,07,480 and a big NII 12,920 shares which totals Rs 10,07,760.

Kotak Mahindra Capital Company, ICICI Securities, Intensive Fiscal Services, Jefferies India, J.P. Morgan India, and Morgan Stanley India Company are the book-running lead managers of the IPO, while Kfin Technologies is the registrar for the issue.

The Vishal Mega Mart IPO offers an opportunity to invest in a growing company within a booming retail market. With strong financials and a strategic focus on omnichannel retailing, the company is positioned to capitalize on the sector’s growth trends. However, potential investors should evaluate market dynamics and competition before subscribing.Investors are drawn to Vishal Mega Mart due to its proven profitability, sector resilience, and omnichannel presence. However, challenges like increasing competition from online retail and established players require careful strategic management.