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Baazar Style Retail IPO: The initial public offering of Baazar Style Retail opens for public subscription today. The Baazar Style Retail IPO is a book-built issue of Rs 834.68 crore, comprising a fresh issue of 3,804,627 shares and an offer for sale, with promoters and investors offloading 17,652,320 shares with a face value of Rs 5 each.
Ahead of the opening of the public issue for subscription, Baazar Style Retail announced that it raised Rs 250.10 crore from anchor investors on August 29, 2024.?
Baazar Style Retail IPO grey market premium (GMP)
Meanwhile, the unlisted shares of Baazar Style Retail continue to command a strong premium in the grey market on the first day of its opening. Baazar Style Retail shares were trading at a premium of Rs 130, or 33.42? per cent higher at the upper end of the IPO price, indicating positive market sentiment for the IPO. However, the GMP of Baazar Style Retail IPO has declined from Rs 141, or 36.25? per cent, as reported on August 27, 2024.
Baazar Style Retail IPO timeline
The Baazar Style Retail IPO, which is available with a price band of Rs 370-389 and a lot size of 38 shares, will end for subscription on Tuesday, September 3, 2024.
Following the closure of the subscription window for the IPO, the basis of allotment of Baazar Style Retail shares is likely to take place on Wednesday, September 4, 2024, and the company's shares will be credited to demat accounts on Thursday, September 5, 2024. Baazar Style Retail shares are scheduled to list on the BSE, and NSE on Friday, September 6, 2024.
For the Baazar Style Retail IPO, Link Intime India is the registrar, while Axis Capital, Intensive Fiscal Services, and JM Financial are the book-running lead managers of the public issue.
Baazar Style IPO review
Several brokerages, including Geojit, Deven Choksey Research, and Swastika Investmart, have reviewed the Bazaar Style Retail IPO and shared their outlook for investors.?Should you subscribe to the Baazar Style Retail IPO?
Deven Choksi Research - Subscribe
Analysts at Deven Choksi Research remain bullish on the public issue and recommend investors subscribe to it. According to the brokerage, the company’s cluster-based expansion model has proven effective, rapidly adding new stores near existing ones to boost operational efficiency and market presence. "A significant focus on expanding private label offerings has driven growth, with a remarkable 64.57? per cent CAGR in this segment. The increase in the repeat purchase rate to 71.94? per cent in FY24 from 68.5? per cent in FY22, an average transaction value of Rs 1,039 in FY24 from Rs 1,026 in FY22, and rising sales per square foot to Rs 7,758 in FY24 from Rs 6,190 in FY22 showcase a growing customer base and strong customer loyalty," said the brokerage in its note.
The brokerage believes that by maintaining its focus on the value retail segment and expanding its online presence, Baazar Style Retail is well-positioned to capture a larger share of the growing Indian retail market.
"Compared to its peers, Baazar Style is growing at a faster pace; moreover, it is trading at a discount with an FY24 adjusted PE of 132x, versus 139x for V2 Retail. Considering these factors, we assign a Subscribe rating to the IPO," said Deven Choksi Research.
Swastika Investmart - Neautral?
Swastika Investmart - Neautral?
Meanwhile, Shivani Nyati, Head of Wealth at Swastika Investmart, has assigned a neutral rating to the public issue of Bazaar Style Retail. Nyati highlighted that the company was the fastest-growing value retailer between 2017 and 2024, showing improvement in margins and growth in both its top and bottom lines. However, she noted that the IPO's P/E valuation is on the higher side.
Nyati believes that while high valuation may be a deterrent, strong market demand is expected to support a positive listing. "Investors may choose to prioritize listing gains, but a cautious approach is warranted due to valuation," she added.
Geojit - Subscribe?
Analysts at Geojit remain bullish on the public issue of Bazaar Style Retail IPO and recommend that investors subscribe to the issue. The brokerage, in its report, highlighted that as of March FY24, the total debt stands at Rs 178.2 crore with a D/E ratio of 0.8x. From the net IPO proceeds, Rs 113.7 crore will be utilised for debt repayment, trimming the D/E ratio down to 0.1x post-IPO.?
At the upper price band of Rs 389, BSRL is available at a Mcap/Sales of 3.0x (FY24), which appears reasonably priced to the brokerage compared to its peers. "Considering the rise in demand, aggressive store additions, customer retention, cluster-based expansion model, and positive industry growth opportunities, we assign a 'Subscribe' rating on a short to medium-term basis," said Geojit in its report.
About Baazar Style Retail
Baazar Style Retail is a leading value fashion retailer in Eastern India, holding market shares of 3.03? per cent in West Bengal and 2.22? per cent in Odisha. As of FY2024, it operates 162 stores across 146 cities, making it the largest value retailer in the region. As of March 31, 2024, Baazar Style Retail operated 162 stores across 146 cities in nine states, making it one of the fastest-growing value retailers in the region.
As of FY2024, the company's restated consolidated revenue from operations stood at Rs 982.83 crore. Baazar Style Retail’s profit after tax for FY24 was reported at Rs 21.94 crore.
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